The U.S. House Oversight Committee has initiated a significant investigation into prediction markets Polymarket and Kalshi, amid allegations that government employees might exploit classified information for personal profit. Led by Rep. James Comer (R-Kentucky), the inquiry seeks internal records from both platforms to assess the extent of insider trading. Comer highlighted concerns that members of Congress and other government officials could leverage insider knowledge to make substantial gains from policy and national security events. He indicated that legislation might be introduced to bar government employees from participating in these markets.

The investigation comes as prediction markets have surged in popularity, with volumes expected to reach $1 trillion by 2030. Recent scrutiny from lawmakers has intensified, particularly following a Senate Commerce Committee hearing where concerns were voiced about gambling-related scandals and the potential for manipulation in sports. Critics argue that the aggressive marketing tactics of these platforms may lead to problem gambling, especially among youth. Furthermore, experts warn that irregular trading patterns could pose national security risks, as they may be detectable by adversaries observing these markets.