Infiniti Intelligence Hourly Briefing — Oct 8, 2026 · 11:54 AM ET

Rep. Ritchie Torres (D., N.Y.) is accelerating a federal proposal to restrict insider trading in prediction markets after an anonymous, newly created Polymarket account reportedly earned more than $400,000 in less than 24 hours betting on Nicolás Maduro’s removal from power. According to Front Office Sports, whose report was republished by GambleRSS, the trades surrounding U.S. military action in Venezuela have shifted legislative attention beyond the industry’s disputes over sports contracts.

Torres’s communications director, Benny Stanislawski, told Front Office Sports that the congressman intended to introduce the legislation that week, without identifying a day. The Public Integrity in Financial Prediction Markets Act of 2026 was first reported by Punchbowl founder Jake Sherman. Stanislawski said work on the proposal was already underway before the Maduro news prompted its public disclosure.

Proposed restrictions on government insiders

According to a draft shared with Front Office Sports, the bill would prohibit federal elected officials, political appointees and executive-branch employees from trading contracts linked to government policy, government action or political outcomes when they possess material nonpublic information—or could reasonably acquire it through their official responsibilities. The proposed restriction therefore reaches beyond officials who already hold relevant confidential information.

The Polymarket activity included contracts on whether president Nicolás Maduro would lose power by the end of the month. Its timing drew widespread social-media attention and coverage from outlets including the Wall Street Journal, raising questions about possible access to inside information without establishing that misuse occurred. Polymarket did not immediately answer a request for comment. Kalshi, its principal competitor, said on social media that its rules already prohibit direct or indirect trading in a contract by anyone holding material nonpublic information about it.

Earlier concerns and a broader regulatory fight

Front Office Sports also described an earlier Venezuela-related episode: in October, a newly created Polymarket account reportedly won more than $50,000 backing María Corina Machado for the Nobel Peace Prize, hours before the announcement. Following her win, the Norwegian Nobel Institute said it would investigate whether information had been obtained unlawfully from the organization. The institute did not immediately respond to a request for comment Monday.

Other lawmakers have pursued different forms of oversight. New York Assemblyman Clyde Vanel introduced legislation in November that would authorize the state to regulate or prohibit prediction markets. In September, a bipartisan group of lawmakers from Utah, Arizona, Michigan and California sent the Commodity Futures Trading Commission (CFTC), the federal regulator overseeing prediction markets, a letter raising concerns about sports event contracts.

Those disputes followed rapid industry expansion in 2025, when Polymarket and Kalshi each raised billions of dollars and DraftKings and FanDuel introduced their own platforms. Kalshi, Robinhood, Crypto.com and other operators have encountered resistance from state regulators, with numerous lawsuits moving through the courts. A central question is whether sports event contracts differ from conventional sports wagering: the latter is regulated state by state, while platforms such as Kalshi have offered contracts across all 50 states. The report says 39 states and Washington, D.C., permit some form of online betting.

According to Front Office Sports, Polymarket had avoided legal and regulatory scrutiny since resuming U.S. operations after an absence of nearly four years. It had been barred from operating in the country during that period under a settlement with the Biden administration.

What it means for prediction markets

• The proposal targets information access, not just contract categories. Its stated scope covers certain federal officials and employees trading government-related or political contracts, including those who could reasonably obtain sensitive information through their duties.
• Introduction is the next legislative milestone. The reporting describes a planned bill, not an enacted restriction, and provides no specific introduction date.
• Suspicious timing does not establish insider trading. The Maduro account’s reported gains raise integrity questions, but the supplied reporting does not establish who controlled it or whether confidential information was used.
• Integrity rules and sports-contract legality are separate issues. Torres’s initiative concerns informational advantages, while the ongoing state disputes focus on the regulatory treatment of sports event contracts.

Kalshi and Polymarket are discussing fresh funding with potential investors at valuations approaching $20bn (£15bn) each, according to Wall Street Journal reporting cited by EGR Intel and republished by GambleRss. Negotiations remain preliminary, and neither privately held company is assured of securing that valuation.

New funding ambitions follow major investments

Kalshi’s December Series E raised $1bn at an $11bn valuation, part of a wave of investment in both platforms toward the end of 2025. Paradigm led the round, with Sequoia Capital, Andreessen Horowitz, Meritech Capital and IVP participating. Less than two months earlier, Kalshi had raised $300m in a round that enabled expansion into more than 140 countries, according to EGR Intel.

Polymarket received a $2bn investment from Intercontinental Exchange (ICE) around the same period, valuing it at more than $8bn. EGR Intel also reported that Polymarket, unavailable in the US since 2022, acquired Commodity Futures Trading Commission (CFTC)-licensed QCEX to accelerate its return.

The fundraising discussions contrast with falling valuations among listed sports betting operators facing pressure from prediction markets. According to EGR Intel, Flutter’s shares have declined more than 60% over the past six months, leaving its market capitalisation at $19.7bn. DraftKings has fallen 45.2% over the same period, with a market capitalisation of $12.4bn.

Market conduct and regulatory challenges

Both platforms faced scrutiny earlier this month over contracts connected to US and Israeli strikes on Iran. EGR Intel reported that six Polymarket users earned a combined $1.2m on a market concerning the timing of a US strike on Iran, raising concerns about possible insider trading. That market was created in December 2025.

Kalshi separately faced criticism after declining to pay out trades on whether former Ayatollah Ali Khamenei would leave office by a specified date. CEO Tarek Mansour said on X that the platform would not make payouts on markets involving death; trades in the market were refunded, according to EGR Intel.

State-level opposition also remains significant. In January, a Massachusetts judge issued a temporary injunction preventing Kalshi from offering sports-related event contracts in the state without a gaming licence. In November, a Nevada judge overturned an earlier injunction that had permitted Kalshi to continue operating during a prolonged dispute with the state regulator, EGR Intel reported.

Regulators in Tennessee and Connecticut have sent cease-and-desist orders to prediction-market platforms, including Kalshi and Polymarket, in recent months. Polymarket also received a cease-and-desist order from the Netherlands Gambling Authority last month, according to EGR Intel.

What it means for prediction markets

• Valuations remain provisional. The reported $20bn figures are fundraising targets under discussion, not completed transaction values.
• Access remains a separate question. Investor interest does not resolve the court orders, licensing disputes or regulatory objections described in the reporting.
• Settlement rules matter. The Iran-related controversies highlight distinct risks around suspected information advantages and how platforms treat contracts involving a death.
• Comparisons require care. The proposed private-company valuations are being discussed alongside Flutter’s and DraftKings’ public-market capitalisations, rather than confirmed funding outcomes.