Wall Street banks are restricting employees from trading on prediction market platforms over concerns that non-public information may be used to trade event contracts.
Goldman Sachs has barred its employees from trading on the bank’s unique event contracts, which cover financial markets, macroeconomic events, elections and geopolitics, CNBC reported, citing people familiar with the matter.
An unnamed Morgan Stanley source also told CNBC that the bank has a policy regarding prediction market trading by its employees, while a Bank of America spokesperson said the bank is in the process of enacting new bans on its employees regarding prediction market trading.
The report further raises concerns about insider trading in prediction markets and has attracted the attention of the White House and U.S. lawmakers, who are proposing legislation aimed at restricting political prediction market trading by government officials.
Cointelegraph reached out to Goldman Sachs to ask what prompted the precautionary policy. A bank spokeswoman declined to comment.
In May, the U.S. Department of Justice and the Commodity Futures Trading Commission (CFTC) announced that Google software engineer Michele Spagnuolo gained $1.2 million in polymarkets by accessing nonpublic information while on the job.
On June 18, Representative Brian Still of Wisconsin introduced legislation that would prohibit certain public officials from “betting on public policy issues or political outcomes,” but did not mention members of the White House.
A major flashpoint occurred in January. A soldier is said to have bet more than $400,000 on the ouster of Venezuelan President Nicolas Maduro, who was ousted and captured by the U.S. military.
Polymarket seeks broader access in US
Meanwhile, Polymarket is seeking regulatory approval to offer margin trading for US users, which would allow them to bet on events with less upfront capital.
According to a July 3 filing with the National Futures Association (NFA), Prediction Markets has applied to become a futures commission agent through its affiliated company, Coming Home GBA LLC.
The filing marks Polymarket’s latest attempt to expand its U.S. footprint and attract more users. Cointelegraph has reached out to Polymarket for comment on this matter. Platforms also need approval from the CFTC to allow users to conduct non-fully collateralized transactions.
Polymarket’s main rival has already received US regulatory approval to offer margin trading after its affiliate Kinetic Markets LLC received NFA approval in March.
Coming Home GBA LLC, Filing. sauce: nfa.futures.org
On June 20, Polymarket reached a record high of $713 million in daily trading volume, according to Dune data. The milestone comes more than a week after the World Cup began on June 11th.
Kalsi also posted a record monthly trading volume of approximately $9.4 billion in June, as the 2026 FIFA World Cup stimulated activity across prediction markets.
