Kalshi CEO Tarek Mansour reportedly said Wednesday that the legal battle over prediction markets will settle whether the industry operates in the U.S. at all, rather than which level of government supervises it.
“It’s not a choice of state versus federal market. It’s a choice of whether prediction markets exist in the U.S. or whether they go offshore,” Mansour reportedly said at DC Fintech Week in Arlington, Virginia.
His comments followed by five days a pair of moves from the Commodity Futures Trading Commission. On Oct. 9 the agency proposed a rule that would expressly define event contracts on sports, politics, culture and weather as swaps, and issued an interim final rule keeping sportsbook wagers and casino games outside that definition. CFTC Chairman Michael S. Selig said at the time that such contracts “are commodity derivatives squarely within the CFTC’s regulatory remit under the Commodity Exchange Act and are within the agency’s exclusive jurisdiction.”
Federal appeals courts have divided on the question, with one major ruling favoring Kalshi and two favoring the states. New Jersey has petitioned the Supreme Court, and the NFL filed a brief supporting the state. Mansour reportedly said at the event that Kalshi feels “pretty good about where we stand overall,” and he rejected the view that sports contracts lack real financial stakes. “The notion that sports does not have economic consequence is ludicrous,” he said.
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Policing Trades in Public
Mansour also reportedly described the visibility of prediction market trading as a “blessing and a curse for prediction markets,” arguing it helps expose wrongdoing. “You’re committing crime in broad daylight, and that makes it so much easier to kind of police that sort of activity,” he said.
He pointed to former Rep. George Santos, saying Santos “decided to insider trade on Kalshi” and that the platform received 100 whistleblower complaints within minutes. “You know, we caught it,” Mansour reportedly said.
The CFTC’s own case against Santos was brought as manipulation. In a July 31 order, the agency found he traded a State of the Union attendance contract, an outcome he controlled, while posting misleading statements about whether he would go. He agreed to disgorge $17,569.98, pay a $17,500 civil penalty and accept a three-year trading ban.
The Teleprompter Case
In a separate insider-trading case, the CFTC settled with Gabriel Perez, a onetime White House teleprompter operator, and thanked KalshiEX for its assistance. He traded presidential mention contracts using speech text he saw before delivery. Perez agreed to pay more than $172,000 in disgorgement and penalties and accepted a three-year ban. Kalshi and Polymarket have both rolled out insider-trading controls as scrutiny has grown.
Mansour also dismissed claims on X that Kalshi’s bitcoin and ether perpetual-futures volume was inflated, attributing the recurring trade sizes to fixed-size orders from market makers.
Public comments on both CFTC rules are due within 30 days of their publication in the Federal Register.
Related Listen: Bits + Bips: Is Kalshi Headed to the Supreme Court Next?
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