Kalshi suspends California candidate, fines YouTube editor for insider trading

Prediction market platform Kalshi banned a former California gubernatorial candidate for betting on his own race and penalized a YouTube editor for trading on nonpublic information. The politician received a five-year suspension. The editor was banned for two years and fined about $20,000. Both matters were referred to the Commodity Futures Trading Commission (CFTC).

Robert DeNault, Kalshi’s head of enforcement, detailed that the politician placed about $200 in wagers on his 2025 candidacy and publicized at least one bet on X. The platform noted that the account did not withdraw profits. Kalshi did not release the politician’s name, stating he is no longer in the governor’s race and is now seeking a seat in Congress.

Although Kalshi did not disclose the politician’s identity, that profile appears consistent with Kyle Langford, a former Republican who is now running as a Democrat for California’s 26th Congressional District in the US House. On May 25, 2025, Langford shared a video on X displaying a $100 bet on his own victory.

In the second enforcement action, the platform found that a YouTube editor traded about $4,000 on “YouTube stream” markets between August and September 2025, violating insider trading rules. An internal review led to a two-year suspension and roughly a $20,000 penalty. “Our surveillance systems flagged his near-perfect trading success on markets with low odds, which were statistically anomalous,” the company stated. With tips from other traders, it identified the person’s employer and concluded he likely had access to material nonpublic information.

Kalshi, which operates under CFTC oversight, reported opening about 200 investigations into suspected market abuse and freezing several flagged accounts. More than a dozen cases remain active. Earlier this month, it formed a surveillance audit committee and partnered with Solidus Labs to detect, investigate and address manipulation, fraud and insider trading.

Regulators are increasing attention on event-contract platforms as participation grows. The CFTC chair announced a prediction markets advisory to work with industry participants on detecting and deterring insider trading. “Let me be clear: if you attempt to engage in manipulation, fraud, or insider trading, we will find you and take action,” the chair warned.

Kalshi noted that both cases were surfaced by monitoring tools and reports from traders. The platform reiterated that wagering on one’s own candidacy or using information gained through employment violates its insider trading policy.

Previously, Kalshi removed all affiliate badges from X accounts after the platform tightened rules requiring clear labels for gambling and prediction market promotions. Scrutiny rose when X’s Head of Product Nikita Bier warned users that undisclosed paid posts about Kalshi could lead to suspension. Polymarket-linked accounts continued to display badges and previously announced an official partnership to bring prediction market data to X.