TLDR
- The CFTC has privately warned Kalshi it could face charges over how it notified the agency about new contracts.
- Kalshi says the issue is a procedural error involving a handful of contracts, many never live.
- A person with knowledge of the probe says dozens of products are under review.
- The case centers on self-certification, which lets exchanges list products without prior approval.
- Polymarket faces a separate CFTC review tied to its 2022 settlement.
The US Commodity Futures Trading Commission has warned Kalshi that charges could follow a months-long review of its filings, Politico reported on Tuesday. The probe looks at whether the prediction markets operator properly told the agency about new products before offering them. A person with direct knowledge of the matter said the agency sent its notice privately.
BREAKING: CFTC warns Kalshi of potentially imminent charges over failure to notify regulators of new products, per Bloomberg.
The US Commodity Futures Trading Commission (CFTC) has reportedly warned prediction market platform Kalshi that it could SOON face enforcement charges… pic.twitter.com/33x2vHkwv1
— Coin Bureau (@coinbureau) November 11, 2026
The same person said the matter could still end in a settlement. No formal charges have been announced. The CFTC has not named the contracts under review or shared a proposed penalty.
What Kalshi and the Source Say
Kalshi spokesperson Elisabeth Diana called it “a procedural error involving the submission of a handful of contracts, many of which weren’t live.” She added that the company is “already addressing the issue.” The source, however, described notification issues covering dozens of products.
That gap between the two accounts has not been settled in public. The agency did not immediately respond to requests for comment. Kalshi runs a CFTC-regulated exchange with contracts on elections, financial markets, sports and other events.
How Self-Certification Works
The probe centers on self-certification. This process lets regulated exchanges list certain derivatives without the CFTC approving each one. Exchanges must notify the agency and certify that the contracts follow the rules.
Those rules include details on how a contract settles. Exchanges must also assess whether a contract could be open to manipulation. The CFTC wants that information before trading starts.
On July 24, the agency’s Division of Market Oversight issued an advisory to exchanges on this topic. It raised concerns about filings that bundle many possible contracts into one submission with broad, template-style language. The advisory said such certifications “should not be submitted.”
The guidance still lets closely related contracts be certified together under certain conditions. It did not name Kalshi. It spoke to the filing habits of designated contract markets in general.
CME Group CEO Terry Duffy has also questioned whether some event contracts are protected enough against manipulation. Self-certification has become part of the wider debate over prediction markets as exchanges add new political, sports and financial contracts.
The warning comes as the CFTC works to establish its exclusive authority over prediction markets. That includes challenging state efforts to regulate Kalshi. Several states say the company must follow local gambling laws for some contracts, while Kalshi says its products are federally regulated derivatives.
Politico also reported that Democrats plan more congressional oversight of prediction markets when the next Congress begins. The party won the November midterm elections.
Kalshi won a legal fight against the CFTC in 2024 over political event contracts, and its available markets grew afterward. On Monday, the company joined Coinbase and four other firms in asking to file a brief backing the CFTC. The brief concerns perpetual futures tied to individual US stocks.
In October, Kalshi completed a $1 billion funding round at a $40 billion valuation. Wellington Management and Sequoia Capital co-led the round.
Polymarket faces its own CFTC probe. The agency is checking whether it followed limits from its 2022 settlement, including steps meant to keep US users out. In January 2022, Polymarket paid a $1.4 million civil penalty for running an unregistered facility offering event-based binary options. No final decision has been announced in either investigation.
