Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Kalshi CEO expects US DOJ to prosecute insider trading cases

semafor.com

Post reply on HN
Print view View original

11–20 of 150 posts

Re: Kalshi CEO expects US DOJ to prosecute insider trading cases

#11

Post by Karrot_Kream »

georgemcbay wrote: post #3

Ok, but isn't the idea that prediction markets surface private knowledge a big part of the defense as to why they shouldn't be treated as illegal gambling? So like, which is it, is insider trading expected, or are these just gambling sites that should be illegal in many jurisdictions?

Prediction Markets, unlike many gambling sites, create a marketplace for odds. There's no house taking positions like in certain casinos or on DraftKings. Market makers offer shares in Yes and No while bettors buy and sell these odds to each other or to market makers.

Re: Kalshi CEO expects US DOJ to prosecute insider trading cases

#12

Post by bradleybuda »

mlmonkey wrote: post #7
slg wrote: post #2

“If you commit insider trading on Kalshi, that can and will at some point be a federal crime. It is a federal crime, I actually do expect the DOJ to prosecute some of these cases”. I'm guessing that “some point” is sometime after Jan 20th 2029.

You give the Dems too much credit.

There was a downward trend during the Biden years [1] but "both sides same" is not even a little bit true.

[1] https://www.citizen.org/article/biden-doj-2024-corporate-cri...

Re: Kalshi CEO expects US DOJ to prosecute insider trading cases

#13

Post by nine_zeros »

mlmonkey wrote: post #7
slg wrote: post #2

“If you commit insider trading on Kalshi, that can and will at some point be a federal crime. It is a federal crime, I actually do expect the DOJ to prosecute some of these cases”. I'm guessing that “some point” is sometime after Jan 20th 2029.

You give the Dems too much credit.

[dead]

Re: Kalshi CEO expects US DOJ to prosecute insider trading cases

#14

Post by Karrot_Kream »

curt15 wrote: post #10
fontain wrote: post #6

Earlier quoted context omitted.

Prediction markets don’t need to surface private knowledge, they can surface sophisticated interpretations of public knowledge. They are certainly gambling if you’re an unsophisticated rube (which is most of the users).

How does one "interpret" public knowledge to time bets so accurately right before Trump's announcements?

I mean that's why insiders are being investigated right?

But sometimes the answer is more difficult than it seems. Is a mid level military officer an insider? If you overheard a conversation on Capitol Hill are you an insider?

Re: Kalshi CEO expects US DOJ to prosecute insider trading cases

#15

Post by Karrot_Kream »

ssharp wrote: post #9
alephnerd wrote: post #5

Earlier quoted context omitted.

> isn't the idea that prediction markets surface private knowledge a big part of the defense as to why they shouldn't be treated as illegal gambling No. Their defense is that they are a gamified platform for futures contracts and hence should fall under CFTC regulation. The CFTC also cracks down on insider trading, but it took time for them to write regulations to catch up with prediction markets. It is now a priorit…

On the Polymarket homepage right now, one of the featured markets is whether or not Bitcoin will be up or down over the next 5 minutes. It's hard to justify that as anything more than illegal gambling. I find prediction markets to be interesting on two fronts: 1) They like a really good way to determine the probability of something happening, which is interesting for events like elections 2) It provides an avenue for…

Polymarket is not CFTC regulated, it's considered illegal in the US. CFTC does not allow betting on securities prices. Cryptocurrency is a bit of a gray area because it's not considered a registered security.

N.B. it becomes a bit frustrating to talk about financial and regulatory things on this site because the level of knowledge is generally "I read some articles on social media about markets" level.

Re: Kalshi CEO expects US DOJ to prosecute insider trading cases

#16

Post by slg »

mlmonkey wrote: post #7
slg wrote: post #2

“If you commit insider trading on Kalshi, that can and will at some point be a federal crime. It is a federal crime, I actually do expect the DOJ to prosecute some of these cases”. I'm guessing that “some point” is sometime after Jan 20th 2029.

You give the Dems too much credit.

No, I was commenting on the current administration's corruption. I don't think most previous Republican administrations would have tolerated the type of insider trading we have seen from people close to the administration. It goes beyond ideology, turning a blind eye to this behavior among your subordinates is a sign of weak leadership and poor management.

Re: Kalshi CEO expects US DOJ to prosecute insider trading cases

#17

Post by pwillia7 »

Karrot_Kream wrote: post #11
georgemcbay wrote: post #3

Ok, but isn't the idea that prediction markets surface private knowledge a big part of the defense as to why they shouldn't be treated as illegal gambling? So like, which is it, is insider trading expected, or are these just gambling sites that should be illegal in many jurisdictions?

Prediction Markets, unlike many gambling sites, create a marketplace for odds. There's no house taking positions like in certain casinos or on DraftKings. Market makers offer shares in Yes and No while bettors buy and sell these odds to each other or to market makers.

when have we ever defined gaming/gambling as 'a thing where the house takes a rake' ? I don't understand this argument and it always feels disingenuous when brought up.

Re: Kalshi CEO expects US DOJ to prosecute insider trading cases

#18

Post by chao- »

georgemcbay wrote: post #3

Ok, but isn't the idea that prediction markets surface private knowledge a big part of the defense as to why they shouldn't be treated as illegal gambling? So like, which is it, is insider trading expected, or are these just gambling sites that should be illegal in many jurisdictions?

If all one cares about is the accuracy of predictions (i.e. setting aside value judgements vis-a-vis society or fairness), it does seem like "insider trading" should make prediction markets more accurate.

Re: Kalshi CEO expects US DOJ to prosecute insider trading cases

#19

Post by fontain »

curt15 wrote: post #10
fontain wrote: post #6

Earlier quoted context omitted.

Prediction markets don’t need to surface private knowledge, they can surface sophisticated interpretations of public knowledge. They are certainly gambling if you’re an unsophisticated rube (which is most of the users).

How does one "interpret" public knowledge to time bets so accurately right before Trump's announcements?

First, you’re describing the insider trading that is not permitted.

Second, the majority of prediction markets are predicting utterly mundane things like sports. The tiny number of news grabbing markets are not representative.

Re: Kalshi CEO expects US DOJ to prosecute insider trading cases

#20

Post by morkalork »

mlmonkey wrote: post #7
slg wrote: post #2

“If you commit insider trading on Kalshi, that can and will at some point be a federal crime. It is a federal crime, I actually do expect the DOJ to prosecute some of these cases”. I'm guessing that “some point” is sometime after Jan 20th 2029.

You give the Dems too much credit.

Hey now, you don't to be divisive do you?
Post reply on HN