The emergence of bad actors like insider traders is inevitable in prediction markets, according to Tariq Mansour, co-founder and CEO of Kalshi. But the executive is not concerned that such behavior might tarnish his business. “There will always be bad actors,” Mansour said during an on-stage interview at Semaphore World Economy in Washington, D.C., yesterday (April 15). “The goal is to crush them.” He believes the cases will be eliminated by Calci’s internal investigations and, eventually, by federal prosecutors.
Mansour, 29, co-founded Calci in New York in 2018 alongside Luana Lopez Lara, whom he met while studying at MIT. The duo, both from Wall Street, used their backgrounds in finance to build a regulated platform for trading “event contracts.” Users can bet on outcomes across politics, culture and sports.
Calci – and its primary competitor Polymarket – entered the mainstream during the 2024 US presidential election, and has grown rapidly since then. Last month, Calci doubled its valuation to $22 billion after raising a $1 billion round led by Coatue Management, and has reportedly reached $ Annual run rate is $1.5 billion. “We are definitely the fastest growing company outside of artificial intelligence in America,” Mansour said. Annual operating rate is a forecast of future revenue.
Growing concerns about insider trading
The boom in prediction markets has also brought more scrutiny. Unusual deals, including one that correctly forecast the US arrest of Venezuelan President Nicolas Maduro before it became public knowledge, have fueled suspicions of insider activity. Earlier this year, Kalshi suspended a content editor affiliated with YouTuber MrBeast after he made a series of strikingly accurate bets on the influencer.
Such users “should definitely be banned,” Mansour said. “No one wants to participate in a system that is fundamentally unfair.”
Calci has opened about 200 insider trading investigations in the past year. Mansour warned that such cases may soon bear serious consequences. “If you commit insider trading in Calci, that can be — and will at some point become — a federal crime,” he said. “I actually expect the Department of Justice to prosecute some of these cases.”
He added that internal trading is not limited to prediction markets, pointing to its long history in traditional financial markets. Mansour sees regulatory oversight as a natural evolution: “The presence of bad actors in a system should not invalidate the system, but rather legitimize the organization.”
How are prediction markets organized?
Who ultimately rules the prediction markets remains unsettled. Calci received approval from the Commodity Futures Trading Commission (CFTC) in 2020 to operate as a federally regulated exchange for event contracts – distinct from a gambling platform. Mansour said federal oversight provides consistency compared to what he described as a “patchwork” of state laws. For example, of the more than 30 states that allow sports betting, only one prohibits advertising for problem gamblers.
The issue has caught the attention of the Trump administration, which recently filed lawsuits against the states of Illinois, Connecticut and Arizona seeking to establish federal authority over prediction markets. The administration says these platforms operate as financial markets and therefore should fall under CFTC regulation, while some states claim they are a form of gambling subject to state law.
Arizona escalated the conflict last month when it became the first state to file criminal charges against Calci, accusing the company of running an illegal gambling operation.
