#Kalshi #Polymarket #CFTC #Hyperliquid
39 winning contracts out of 43. Kalshi's insider was caught by Kalshi
🟢 Perez had worked for Trump since 2016 and saw speech drafts before they were delivered. Between December 2025 and February 2026 he traded mention contracts - bets on whether the president says a specific word - around the State of the Union, Davos, the National Prayer Breakfast and rallies in Pennsylvania, North Carolina, Iowa and Georgia.
Profit $107,539.02, plus a $65,000 penalty discounted for "exemplary cooperation" and a three-year trading ban; he did not admit the findings, and Manhattan prosecutors passed on a criminal case.
⏺️ February - a MrBeast-linked editor: $20,397.58 for trading on unreleased videos
⏺️ May - Google engineer Michele Spagnuolo: more than $1.2M on Polymarket off internal Year in Search data, charged by the Southern District of New York
⏺️ July 31 - George Santos: the CFTC clawed back $17,569.98 in profit plus a $17,500 penalty and a three-year ban across its registered venues
⏺️ August 31 - Kalshi's first-ever lifetime ban, same Santos, plus a $71,356 fine, exactly four times his $17,839.57 in winnings
The same notice sanctioned candidates who bet on their own races, and the gradient there is the point. Laurie Buckhout, a Republican in North Carolina, bought under $1,000 of contracts on her own campaign, cooperated with the inquiry and drew three years plus $2,589.96: "I bet on myself. Literally. It was a dumb mistake." Santos refused to cooperate - and got a lifetime ban.
🟢 So who is really watching the price?
Both CFTC orders grew out of Kalshi referrals. The regulator has the tools: it treats these contracts as swaps and applies Section 6(c)(1) of the Commodity Exchange Act and Regulation 180.1. It is busy elsewhere - more than twenty states are suing the venues over sports contracts, New York wants Kalshi stopped, and the same evening the Perez order landed, Kalshi lost at the Ninth Circuit.
Robert DeNault, Kalshi's head of enforcement, put the job plainly: compliance exists to "catch bad actors, punish them, and deter other people from doing it again."
On July 20 Hyperliquid announced the permissionless phase of HIP-4: anyone can list an event market by staking 500,000 HYPE, roughly $30M at that day's price. The stake locks for six months, and validators can slash it by vote for a badly defined market, a wrong settlement, or a resolution left hanging more than a week.
So the bond answers for how the market was built, while nobody there answers for what the trader knew walking in. The lesson travels past Kalshi: a prediction market is worth exactly what its surveillance is worth.
➡️Crouton.digital | About us⬅️
39 winning contracts out of 43. Kalshi's insider was caught by Kalshi
On August 28 the CFTC fined White House teleprompter operator Gabriel Perez $172,539.02 for trading contracts on the words in Trump's speeches. Of 43 trades, 39 won.
The regulator did not open the case: Kalshi's own surveillance flagged the anomaly and handed it over. The order dropped on a Friday at 8:14 p.m. ET.
🟢 Perez had worked for Trump since 2016 and saw speech drafts before they were delivered. Between December 2025 and February 2026 he traded mention contracts - bets on whether the president says a specific word - around the State of the Union, Davos, the National Prayer Breakfast and rallies in Pennsylvania, North Carolina, Iowa and Georgia.
Profit $107,539.02, plus a $65,000 penalty discounted for "exemplary cooperation" and a three-year trading ban; he did not admit the findings, and Manhattan prosecutors passed on a criminal case.
The conclusion is obvious.: on a market that sells a price, the tell is not position size but hit rate, and only the venue with the whole book in front of it can see that.
⏺️ February - a MrBeast-linked editor: $20,397.58 for trading on unreleased videos
⏺️ May - Google engineer Michele Spagnuolo: more than $1.2M on Polymarket off internal Year in Search data, charged by the Southern District of New York
⏺️ July 31 - George Santos: the CFTC clawed back $17,569.98 in profit plus a $17,500 penalty and a three-year ban across its registered venues
⏺️ August 31 - Kalshi's first-ever lifetime ban, same Santos, plus a $71,356 fine, exactly four times his $17,839.57 in winnings
The same notice sanctioned candidates who bet on their own races, and the gradient there is the point. Laurie Buckhout, a Republican in North Carolina, bought under $1,000 of contracts on her own campaign, cooperated with the inquiry and drew three years plus $2,589.96: "I bet on myself. Literally. It was a dumb mistake." Santos refused to cooperate - and got a lifetime ban.
🟢 So who is really watching the price?
Both CFTC orders grew out of Kalshi referrals. The regulator has the tools: it treats these contracts as swaps and applies Section 6(c)(1) of the Commodity Exchange Act and Regulation 180.1. It is busy elsewhere - more than twenty states are suing the venues over sports contracts, New York wants Kalshi stopped, and the same evening the Perez order landed, Kalshi lost at the Ninth Circuit.
Robert DeNault, Kalshi's head of enforcement, put the job plainly: compliance exists to "catch bad actors, punish them, and deter other people from doing it again."
On July 20 Hyperliquid announced the permissionless phase of HIP-4: anyone can list an event market by staking 500,000 HYPE, roughly $30M at that day's price. The stake locks for six months, and validators can slash it by vote for a badly defined market, a wrong settlement, or a resolution left hanging more than a week.
So the bond answers for how the market was built, while nobody there answers for what the trader knew walking in. The lesson travels past Kalshi: a prediction market is worth exactly what its surveillance is worth.
➡️Crouton.digital | About us⬅️