Kalshi, a prominent prediction market platform, announced on Wednesday that it has removed a former candidate from the 2026 California gubernatorial race and a popular YouTuber due to suspected insider trading violations. The company’s head of enforcement, Robert DeNault, shared details of the enforcement actions in a blog post, highlighting that the platform’s surveillance system detected suspicious trading behavior in both cases.
The political candidate, who has not been publicly named but is believed to be Kyle Langford, a far-right Republican known for controversial comments, was flagged for a video shared online, allegedly showing him trading on his own candidacy. Following this discovery, Kalshi suspended Langford’s accounts and informed the Commodity Futures Trading Commission of the incident. The candidate has been issued a five-year ban, and the platform plans to impose a penalty ten times greater than the initial trade amount, donating the proceeds to charity. Langford previously dropped out of the gubernatorial race to pursue a campaign as a progressive Democrat in California’s 26th district.
In a separate incident, Stephen Cloobeck, a Democratic donor who briefly entered the gubernatorial race before endorsing Congressman Eric Swalwell, faced similar consequences when he attempted to trade on the outcome of the election. DeNault stated that any candidate trading on their own race leads to immediate disciplinary action, which includes account suspension.
In addition, Kalshi reported that it had also suspended a YouTube streamer after identifying “statistically anomalous” trading behavior. The platform’s investigation revealed that the streamer’s associate, employed as an editor for his show, likely had access to confidential information that influenced his trading activities. This account has been suspended for two years and has incurred a financial penalty.
These actions reflect Kalshi’s commitment to maintaining integrity within its prediction market, especially given the rising popularity and associated scrutiny of such platforms. Recent incidents involving allegations of insider trading, including high-profile trades linked to geopolitical events, have led to calls for clearer regulations and oversight. While attempts have been made in Congress to address insider trading in prediction markets, no significant enforcement actions have been documented publicly as of yet.
As prediction markets continue to expand, ensuring transparency and adhering to fair trading practices remains crucial. Kalshi’s actions aim to set an example in maintaining a responsible trading environment, particularly as user engagement increases across the platform.