Kalshi Funds GOP-Backed Advocacy Group to Push CFTC Oversight of Prediction Markets

Kalshi is putting new political muscle behind prediction markets. The regulated market operator announced funding for a new advocacy group, Americans for Fair Markets (AFM), aimed at shaping federal policy for prediction markets and federally regulated exchanges — a move that comes as the industry faces growing pushback from casinos, sportsbooks, state regulators and lawmakers. AFM launched with Taylor Budowich — a longtime Republican operative who most recently served as deputy White House chief of staff under Susie Wiles — as a strategic advisor, giving the group a direct line into GOP political circles. Kalshi’s head of government relations, John Bivona, who sits on AFM’s board, framed the effort as a counterweight to powerful gaming interests: “We’re not going to be outspent or out-organized by entrenched interests protecting their monopolies,” he said. Kalshi also said AFM will run paid and earned campaigns to push back on what it calls “false narratives about prediction markets.” AFM’s stated agenda focuses on consumer protections and federal oversight. Key priorities listed by the group include: - Know-your-customer (KYC) checks - Bans on insider trading - Full funding for the Commodity Futures Trading Commission (CFTC) - Prohibitions or limits on contracts tied to war, death, terrorism and assassination The launch comes amid heightened scrutiny of prediction markets. The U.S. House Committee on Oversight and Government Reform has opened an investigation into Kalshi and crypto-native rival Polymarket, requesting records on user screening, geographic restrictions and controls for suspicious trading. Regulators and lawmakers are concerned that people with non-public government information could exploit event contracts; those worries were amplified by reports of allegedly suspicious trades tied to geopolitical events and a widely reported case in which a U.S. Army master sergeant was accused of using classified information to earn more than $409,000. Kalshi wants prediction markets to be regulated at the federal level under the CFTC, but state regulators argue that some event contracts — especially markets linked to sports — fall under local gambling laws. That jurisdictional clash widened after Kalshi and Polymarket lost emergency bids in Nevada and Washington. A Ninth Circuit panel subsequently held that a federal derivatives defense does not automatically move state gambling cases into federal court, strengthening states’ ability to press local claims. Beyond lobbying, Kalshi has been expanding its product and institutional reach. Wall Street research and trading desks have flagged Kalshi’s first bespoke block trade as a sign of movement toward institutional event-risk trading, and prime broker Clear Street added a regulated access route for larger clients. The company has also cropped up in coverage about crypto perpetual futures and data/media partnerships: Kalshi’s real-time market probabilities have been integrated into major news outlets — including prior integrations with CNN and CNBC — and are slated for distribution across multiple Fox platforms. For crypto observers, the stakes are clear: the fight over how prediction markets are regulated will shape the competitive landscape for both regulated firms like Kalshi and crypto-native platforms such as Polymarket. AFM’s launch signals that Kalshi isn’t leaving the regulatory battlefield to chance, and that the industry’s debate over federal versus state oversight, consumer protections and acceptable contract types is only intensifying.