TLDR
- The CFTC is reviewing prediction market “mention markets” over concerns they may be easy to manipulate, according to two people familiar with the matter.
- Kalshi removed sports mention markets until further notice while political and earnings mention markets stay active.
- CFTC rules require exchanges to only list contracts that are not easily manipulated.
- Kalshi previously flagged its own trader, Trump’s teleprompter operator, after suspicious mention-market trades produced over $90,000 in profit.
- The CFTC has not confirmed the inquiry, and both the agency and Kalshi declined to comment.
The Commodity Futures Trading Commission is looking into prediction market contracts known as “mention markets.” These are contracts based on whether a specific person says a certain word out loud.
NPR reported the review on Aug. 13, citing two people with direct knowledge of the inquiry. The report says regulators are concerned these contracts may be too easy to manipulate.
Kalshi has already responded. The company pulled its sports mention markets “until further notice.”
The CFTC has not made a public announcement about the review. Both the agency and Kalshi declined to comment when NPR asked for details.
What Are Mention Markets?
Mention markets let traders bet on whether someone will say a specific word or phrase. Sports versions have included wagers on whether a broadcaster says words like “MVP,” “ankle” or “redshirt.”
Kalshi removed all sports mention contracts as part of this review. Other mention markets are still running.
Political mention markets tied to President Trump remain active. Earnings call mention markets also remain live, including one tied to Klarna where traders bet on whether executives mention certain companies or topics.
Polymarket also offers mention markets, but only on its offshore platform. Its regulated U.S. exchange does not currently list them.
Manipulation Rules at the Center
Federal law requires exchanges to list only contracts that are not “readily susceptible to manipulation.” Exchanges must also run surveillance systems that can catch and stop manipulation.
This rule matters here because of how mention contracts settle. A sports contract based on final scores usually cannot be controlled by one person alone.
A mention contract works differently. One broadcaster, executive or politician can settle the outcome just by saying a single word.
The CFTC has also told prediction markets in the past that broad self-certifications are not enough. Each product needs clear details on settlement methods and compliance controls.
The most recent case pushing this issue forward involves Gabriel Perez, Trump’s longtime teleprompter operator. Kalshi flagged trades tied to words used in presidential appearances and referred the activity to federal regulators.
Sources told Reuters that more than $90,000 in potential profits were frozen before Perez could withdraw them. He reportedly had early access to prepared remarks for more than a dozen presidential events. The White House later removed him from his position.
This was not the first manipulation case tied to event contracts. Former Rep. George Santos recently agreed to penalties over Kalshi trades tied to whether he would attend Trump’s State of the Union address.
Kalshi has taken some steps on its own. The company has added disclosure rules for higher-risk markets and said it blocked more than 100 potential insider trades in the first quarter.
Sports mention markets remain suspended for now, with no return date announced. Other mention markets tied to politics and corporate earnings continue trading while the review continues.
