New York Governor Signs Executive Order Limiting Insider Trading by Public Officials in Prediction Markets

On April 23, New York Governor Kathy Hochul signed an executive order on Wednesday prohibiting state government employees from trading in prediction markets or assisting others in profiting from non-public information. This move aims to address growing concerns over ‘insider betting’ in prediction markets. According to the executive order, all government officials appointed by the governor or under her jurisdiction are prohibited from using any non-public information obtained during their duties to gain benefits or avoid losses in prediction markets or similar services, and they are also barred from assisting others in such activities. The governor noted in the document that the current ‘rapid expansion of prediction markets’ has raised regulatory concerns. The day before, Illinois Governor JB Pritzker also issued a similar executive order prohibiting state government personnel from using non-public information to participate in prediction market betting. Meanwhile, prediction market platform Kalshi disclosed that it has launched investigations into three cases of insider trading involving candidates and has imposed fines and trading suspensions on the individuals involved. One of the punished individuals is Mark Moran, a candidate in the Virginia Senate Democratic primary, who was penalized for betting on his own campaign and stated he ‘hoped to be discovered.’