Key Takeaways
- Kalshi removed all sports mention markets as the CFTC reviews them, NPR reports.
- Trump markets are 82% of the $1.16M in visible volume still listed on Kalshi.
- Washington bans the whole mentions category, with geofencing due by Sept. 2.
Sports Mentions Are Gone but Trump Markets Are Still Trading
Federal regulators have opened a review of mention markets, and Kalshi has removed all of its sports versions as the inquiry proceeds, according to NPR, citing two people with direct knowledge who spoke anonymously because they were not authorized to speak publicly. Kalshi and the CFTC both declined to comment, and the commission has published nothing describing a review. Sports wagers account for the bulk of the billions traded on Kalshi each week.
Per the Commodity Exchange Act, designated contract markets may list only contracts that are not readily susceptible to manipulation, and one of NPR’s sources said mention markets are “potentially very easy to manipulate, so the CFTC is taking a hard look at whether some of them make sense.” A second source and a former Kalshi employee told the outlet that the exchange’s own lawyers share that concern, since the nature of some markets attracts people positioned to move the outcome. Inside Kalshi, staff members have debated the category’s usefulness, with co-founder Luana Lopes Lara championing it, according to the former employee.
As of Friday, our review showed that Kalshi’s Mentions section offers no sports filter at all: the only subcategories are earnings, politicians, Trump and a public companies hub. At least 216 individual contracts remain across 12 market groups: earnings-call mentions for Klarna, Walmart, Target, Home Depot, John Deere, Toll Brothers, Futu and Amer Sports are all scheduled to open next week, alongside a NASA press conference and a Massachusetts Senate debate. Polymarket also offers mention markets, but only on its overseas platform, which the CFTC does not regulate. Its smaller US exchange does not currently list them.
In a Washington court, King County Superior Court Judge John McHale’s amended injunction orders Kalshi to stop marketing, offering, or accepting contracts on sports, elections, politics, entertainment, culture, tech and science, or mentions. Commodities, climate, economics, and finance markets may continue. The state attorney general’s office announced the order Thursday, alongside a set of geofencing restrictions. Beyond the gambling violation, the attorney general’s office said, “this type of betting is rife with potential for cheating by people close to the source. Such bets are particularly unfair to consumers.”
The order also bars Kalshi from advertising the covered wagers to Washington consumers, on a finding that “Kalshi’s provision, marketing, and advertising of illegal gambling activities constitute unfair and/or deceptive acts or practices.” The AG’s office pointed to a Kalshi advertisement in which one person texts another that they “found a way to bet on the NFL even though we live in Washington.” It also highlights that Kalshi has previously marketed itself as letting consumers “bet on anything” by calling the service a prediction market rather than gambling.
This builds on the preliminary injunction McHale granted in July, which found Washington likely to prove its case and found “substantial injury to Washington consumers” likely without intervention. Kalshi asked the Court of Appeals to stay that injunction, but the court denied the request.
A recent high-profile controversy related to mention markets involved the White House. Gabriel Perez, Trump’s teleprompter operator, is alleged to have used advance access to prepared remarks to trade mention markets. Kalshi froze about $90,000 of his profits and referred the trades to the CFTC after its surveillance team flagged them. NPR reported that traders treating mention markets as full-time work have installed television antennas to gain fractions of a second on live broadcasts, and that Trump’s digressive speaking style produces sharp price swings as traders guess where he will turn next.
Legal developments are coming thick and fast. The CFTC is trying to shield Kalshi under an emergency order in New York, and a Connecticut judge held that its sports contracts were never swaps – which are just a few of many recent cases of divergent state actions.
