Kalshi has removed sports-related “mention markets” from its platform as US federal regulators review prediction contracts tied to words spoken by public figures.
The Commodity Futures Trading Commission (CFTC) has opened a review of “mention markets,” according to two people familiar with the matter who spoke to NPR on condition of anonymity.
Kalshi has taken down all sports-related mention markets while the CFTC conducts its inquiry, with the contracts removed “until further notice.” The company has not provided a timeline for their possible return.
These markets allow users to wager on whether a public figure will say specific words during a live event. For sports, contracts could involve terms such as “MVP,” “ankle” or “redshirt” being mentioned during a broadcast.
Kalshi Removes Sports Contracts During Regulatory Review
The removal could have a notable impact on Kalshi’s sports segment. Sports contracts account for more than 80% of the platform’s weekly trading volume, making sports-related mention markets an important part of its broader offering.
However, Kalshi continues to offer mention contracts linked to statements made during political events, corporate earnings calls and live television newscasts.
The CFTC’s review focuses on whether certain speech-based contracts comply with federal rules governing event contracts and whether their structure creates opportunities for manipulation.
An individual familiar with the CFTC’s internal discussions said mention markets have attracted bipartisan skepticism because some contracts could be relatively easy to manipulate.
Trump Teleprompter Operator Case Raises Concerns
The regulatory review follows a widely reported incident involving a Kalshi user who traded on statements made by President Donald Trump.
According to regulators, a longtime Trump teleprompter operator used Kalshi to profit from wagers on words the president would or would not say during public appearances.
Kalshi said its internal surveillance systems detected the pattern of unusually well-timed trades and referred the matter to federal authorities.
The incident has added scrutiny to mention markets because individuals with advance knowledge of planned remarks could potentially gain an unfair advantage over other traders.
CFTC Examines Prediction Market Self-Certification
The review also puts renewed attention on the self-certification framework that many US prediction market operators use to launch new contracts.
Under this system, operators can introduce contracts by filing documentation confirming that the products comply with federal rules governing swaps and other financial derivatives.
One key requirement states that a contract must not be “readily susceptible to manipulation.”
According to a source familiar with the CFTC investigation and a former Kalshi employee, both federal regulators and Kalshi’s legal team have raised concerns about whether certain speech-based markets meet that standard.
The concern centres on the possibility that some mention markets could attract participants who have access to information that other traders do not have.
Kalshi and Polymarket Take Different Approaches
Kalshi is not the only prediction market offering mention contracts. Polymarket also provides similar markets, although it restricts them to its international platform, which falls outside the CFTC’s US jurisdiction.
Polymarket’s smaller domestic operation does not currently offer this type of contract.
Meanwhile, Kalshi employees have reportedly debated the strategic value of mention markets. Company co-founder Luana Lopes Lara has supported the category, viewing contracts linked to award shows, reality television, earnings calls and other events as a potential way to attract users beyond Kalshi’s core sports audience.
Nevertheless, sports remains Kalshi’s primary source of trading activity. The company has also faced significant legal challenges over its sports contracts, including more than two dozen lawsuits involving US states and tribal entities.
Broadcast Error Highlights Settlement Risks
The controversy also highlights the challenges prediction markets can face when contracts depend on live broadcasts and external sources.
During Fox’s live broadcast of the World Cup final, traders placed millions of dollars in contracts related to which celebrities would appear at the event. However, a Fox sportscaster mistakenly identified Matt Damon as Brad Pitt during the broadcast.
Several news organisations, including outlets that Kalshi designates as source agencies for contract resolution, subsequently repeated the error.
As a result, Kalshi ultimately settled the market in favour of Pitt’s attendance, even though Pitt was not present at the event. According to company data, traders who bet against Pitt’s attendance collectively lost $287,866.
The incident illustrates how reliance on live broadcasts and third-party sources can create settlement risks, particularly when prediction markets involve subjective or rapidly changing information.
Mention Markets Face Greater Regulatory Scrutiny
Kalshi’s decision to remove sports mention markets highlights the growing regulatory pressure surrounding prediction markets in the US.
As operators expand beyond traditional event contracts into sports, politics, entertainment and real-time speech markets, regulators are increasingly examining whether specific products can prevent manipulation and ensure fair settlement.
For Kalshi, the outcome of the CFTC review could determine whether sports mention markets return to the platform or whether the company needs to redesign the contracts before offering them again.
