New York regulators open investigations into major prediction market companies

What This is

• The New York City Council is investigating prediction-market platforms over allegations their advertising is deceptive and encourages people to wager.
• The inquiry targets four platforms: Kalshi, Polymarket, Coinbase and Gemini Titan.
• Council leaders have sent information requests focused on marketing tactics, including influencer promotions and whether endorsements were properly disclosed.
• The Council is looking at claims that promotions may target young adults or even minors and other vulnerable users.
• The probe follows reporting that Polymarket paid content creators who allegedly misrepresented trading earnings.
• The Council has indicated it may hold a public hearing and pursue legislation, using its subpoena power to gather information if needed.
• The city investigation is unfolding alongside broader scrutiny, including state lawsuits and a federal commodities regulator probe mentioned in coverage.
• Separately, Kalshi and DoubleZero launched a low-latency market-data feed aimed at institutional trading in Kalshi’s sports and crypto perpetual contracts.

Why This Matters

• It will shape how aggressively New York officials treat prediction markets as consumer products that need guardrails.
• The probe could change how influencers and platforms must disclose paid promotions, affecting marketing costs and growth.
• If regulators view these products as gambling-like, platforms could face limits on where they can operate and how they can onboard users.
• Mixed city, state, and federal scrutiny raises uncertainty for investors, partners, and customers about what rules will apply.