Kalshi Demands Polymarket Add KYC or Close Offshore Exchange

Kalshi’s head of enforcement, Robert J. DeNault, accused Polymarket of operating without adequate know-your-customer controls and demanded the company add identity checks or close its offshore exchange.

DeNault told Polymarket leaders the platform was being used by insiders and by users in Russia and Iran. He cited an instance in which promotional merchandise was shipped to a user in Moscow and wrote that the activity showed active recruitment of foreign users. DeNault warned: “Enough is enough… If Polymarket is serious about stopping this, either bring all operations into compliance (which starts with KYC) or shut down the offshore exchange. What exists now is not a safe or fair platform to offer prediction markets.”

Polymarket’s vice president of engineering, Josh Stevens, rejected reports that the company would add identity verification to its existing site. Stevens issued a statement saying any verification referenced in recent coverage applies only to a separate product that remains in beta. “No KYC is being added to any part of existing polymarket.com with this launch,” he said, adding that once the beta product leaves testing, it will not require KYC to use.

Both firms say they have strengthened surveillance and rules to curb insider trading. Kalshi upgraded an active surveillance system it calls Poirot and assigned senior executives to handle insider cases ahead of this year’s Super Bowl. Polymarket adopted an updated ruleset intended to define and identify insider trading behavior on its platform.

On May 22, Representative James Comer, chairman of the House Committee on Oversight and Accountability, opened a probe into both Kalshi and Polymarket. Comer’s letters requested information on identification procedures, plans to detect and respond to insider trading, and other compliance measures.

Industry participants and enforcement officials have pointed to methods such as virtual private networks and weak identity checks that can let users bypass geofencing and regional restrictions. Some accounts said Polymarket planned identity checks that would include perks such as direct co-location to reduce trading latency; Polymarket maintains those descriptions conflate a beta product with the main platform.

Lawmakers and regulators have asked both companies for details on identity verification and insider trading safeguards as part of the ongoing oversight of U.S. prediction markets.