Goldman Sachs and JPMorgan Restrict Employee Trading in Prediction Markets Over Insider Trading Concerns

ChainCatcher report, according to CNBC, as prediction markets have raised concerns about insider trading, Goldman Sachs has prohibited its employees from trading contracts related to the bank’s own events, elections, financial markets, macroeconomic data, and geopolitics. Financial institutions such as Morgan Stanley, JPMorgan Chase, and Bank of America are developing or updating related policies, with Bank of America explicitly prohibiting employees from trading prediction market contracts. Previously, the CFTC and the Department of Justice accused a Google employee of using non-public information to profit approximately $1.2 million by trading contracts related to “annual searches” on Polymarket. Legal experts note that the CFTC is still “starting from scratch” in enforcing insider trading regulations, and the wide variety of contract types on these platforms makes comprehensive oversight difficult. Kalshi and Polymarket have respectively introduced employment verification tools and partnered with Chainalysis and Palantir to monitor suspicious activity. Lawyers recommend that companies update their insider trading policies to include event contracts, establish monitoring protocols, and even prohibit access to prediction markets on company devices.