Kalshi has permanently blocked a user for the first time

[Floxynice]

I am not satisfied with the punishment given to him. I would have been satisfied if there is a central connection between all platforms in the prediction market, where anyone found found cheating will be broadcasted to others and permanently blacklisted. But since something of such nature does not exist, he will just smile and go look for another prediction market to cheat like it is normal.

Another punishment he should get should be coming from his work boss (the government), for not drawing the line in his quest for money.   A deserving punishment should be coming from that angle to serve as a deterrent to others.

Next time, prediction markets should not be too mild with the kinds of punishments they give to cheats, others won't stop if they know that they can easily get away with it.

[Fortify]

Kalshi has permanently blocked a user for the first time.

He was former congressman George Santos. The platform claims that he traded in contracts for his own appearance at the president’s speech and then tried to influence their price through public statements.
Santos earned $17,839 from the transactions. Now he also faces a fine of $71,556.

Will there be anything related to Polymarket?
What do you think - will this become a widespread practice? If so, will prediction enthusiasts try to bypass them?

Is this meant to be impressive? Absolve them of all the financial related crimes that they've likely be involved in? Hardly. In fact if this is genuinely the first blocked user then their bad practices are likely much worse than expected. This is simple a token offering, an easy sacrificial lamb, that they serve up while trying to drum up some good press because they are facing the courts in several other cases. In most countries there is a gambling register that every casino has to leave records in, precisely to prevent insider trading and money laundering, yet these companies are skirting around that by pretending to be anything else. If all their customers and the trades they've done were properly scrutinized I'm sure that there would be much more wrongdoing uncovered.

[Alex077]

What do you think - will this become a widespread practice?

If I recall correctly he had previously paid $35000 to settle an investigation by CFTC. Now, Kalshi has imposed lifetime ban on him from their platform. I could see, this lifetime ban was issued as an additional penalty for failing to cooperate adequately with investigation.

Personally, I do not think this will become standard practice. Rather, it will serve as deterrent example. Both Kalshi and Polymarket have now entered mainstream. They are subject to regulatory scrutiny and everyone is highly vigilant. I believe this incident send clear message to these platform. Trading activity of individual who have power to directly influence outcome of any event need to be monitored much more strictly in future.

[abaeze]

Kalshi is a centralized prediction platform with a mandatory KYC procedure (which, by the way, demonstrates why KYC is absolutely evil). 🙋

I like decentralization but it is better to say what is right at the right time and not at the wrong time. You just said what is right at the wrong time or you did not read what the former congressman George Santos did.

There is too much insider betting on prediction markets and which is very inappropriate. Some people will bet but few people will manipulate and earn the money of other the people.

It is better not to bring the topic of the prediction market that creates controversy into the scope of betting. If a person bets on information that the general participants do not know, then he gets an unfair advantage over others.

This is especially unfair in the case of political or public interest events. However, due to insider betting, people's trust and confidence in the results of the prediction market has started to change. Therefore, the misuse of this insider information is a big risk for the prediction market.

[Odogwu-Blockchain]

I thought I saw similar news about Kalshi long time ago where member of the staff altered the results of a prediction, or am I mistaken?

Maybe polymarket committed such crime then, where a user won a prediction that later got altered by the team because prediction got shifted.

If polymarket experienced such flaws, Kalshi will probably do the same sooner or later since they both operated on the same real life prediction market, flaws na mistakes gonna happen.

[Cryptomultiplier]

Kalshi has permanently blocked a user for the first time.

He was former congressman George Santos. The platform claims that he traded in contracts for his own appearance at the president’s speech and then tried to influence their price through public statements.
Santos earned $17,839 from the transactions. Now he also faces a fine of $71,556.

Will there be anything related to Polymarket?
What do you think - will this become a widespread practice? If so, will prediction enthusiasts try to bypass them?

Is this meant to be impressive? Absolve them of all the financial related crimes that they've likely be involved in? Hardly. In fact if this is genuinely the first blocked user then their bad practices are likely much worse than expected. This is simple a token offering, an easy sacrificial lamb, that they serve up while trying to drum up some good press because they are facing the courts in several other cases. In most countries there is a gambling register that every casino has to leave records in, precisely to prevent insider trading and money laundering, yet these companies are skirting around that by pretending to be anything else. If all their customers and the trades they've done were properly scrutinized I'm sure that there would be much more wrongdoing uncovered.

Am sure this move by Kalshi is just to enforce their stance as obeying regulations and a warning to others even though insider trading can't be totally eliminated.
This should make them seem legit enough to allow them keep operating without the government probing them too much since they seem to be doing their job to ensure integrity and commitment to doing their business the legal way.

Kalshi can ban people but I doubt other crypto platforms can easily do so unless they focus on keeping the source of data honest enough to track and monitor and mete out judgement to suspicious wallet activities on the public Blockchain network.

 

[Myleschetty]

Will there be anything related to Polymarket?
What do you think - will this become a widespread practice? If so, will prediction enthusiasts try to bypass them?

Since they have the advantage of being the official partner of the US Open, I believe Kalshi was attempting to safeguard their reputation by learning from PolyMarket's mistakes. They will undoubtedly take every precaution to ensure that their brand receives the necessary exposure rather than being overshadowed by PolyMarket. However, given the unfavorable opinions people have of their ^(PolyMarket) service, it remains to be seen if PolyMarket will follow suit

[Zwei]

If they just block the user, will that really stop him from taking advantage of prediction markets? There is still Polymarket and other platforms, and he does not even need to place the bets himself. He could simply give the insider information to someone else and let them bet for him. As long as he still has access to that kind of information, there are still ways for him to make money from the system.

So if this is his punishment, for me it does not look strong enough. A platform ban only removes one account, it does not really remove the advantage he has from the insider information. And, this one...

it looks performative to me, they are trying to make an example out of him, but this isn't scaring anyone.
the money they can make taking advangate of inside info is just too good.

In a notice of settlement of disciplinary action filed on Monday, Kalshi said Santos violated its rules by trading a bet on whether he would attend the State of the Union. He was then ordered to pay a fine of just over $71,000.

paying a fine will not stop him from doing it again.

i disagree. as long as the fine is more than he or anyone else is out to make from those bets, it will stop people, as it's no longer worth it. but they got to catch them first i guess.

[Chinesebaby]

If they just block the user, will that really stop him from taking advantage of prediction markets? There is still Polymarket and other platforms, and he does not even need to place the bets himself. He could simply give the insider information to someone else and let them bet for him. As long as he still has access to that kind of information, there are still ways for him to make money from the system.

This is just the obvious truth about the former congressman George Santos you just said above, because inasmuch as he still has the power to influence some of the bets that is been offered by these prediction market, such as betting on an appearance during the president's speech and e.t.c, he can still be hiring some individuals, give them the game to bet on and then try as much to ensure the prediction goes as planned, even why his main account have been permanently banned. Or unless if the ban will include the platform's ability to totally ban all bets that has to do with or relates with former congressman George Santos. Because that's the only one way this ban could make sense.

[Hazink]

Permanently ban? Does such even exist if they are to really ban someone in the prediction market? He was caught in the act because he was not smart enough like his colleagues, but the amount which he staked and won on the game (s) that was made public can never be the only amount which he benefited from the bet, so what they asked him to pay as fine can't be said to be above what he won, and I can never believe that shit of them saying he's ban for life when he has people and means to use his advantage and make money off the market.

[boyptc]

Will there be anything related to Polymarket?

Let's hope so, these are the people who are destroying these markets. They have the insider and it was themselves.

What do you think - will this become a widespread practice? If so, will prediction enthusiasts try to bypass them?

For platforms like kalshi and polymarket, they have to make this as a practice and remove these users who are actually officials or politicians that bet for their own appearances.

Well, he's earned enough but he has to pay more than what he's earned for the penalty which is satisfying but there's something more satisfying into it.

[acroman08]

He was former congressman George Santos. The platform claims that he traded in contracts for his own appearance at the president’s speech and then tried to influence their price through public statements.

What did they expect from someone who got JAILED for 7 years because of fraud? Also, markets that can be easily manipulated like this one should be removed if they want to avoid issues like this in the future(though I doubt it will remove insider trading on the platform).

Just curious, did the teleprompter guy who got caught for insider trading on Kalshi get permanently banned too(I don't remember seeing an article saying he got banned)? I mean, if George Santos got banned, why not that guy?

it looks performative to me, they are trying to make an example out of him, but this isn't scaring anyone.
the money they can make taking advangate of inside info is just too good.

Most likely, especially when the guy is a high-profile individual.

[moneystery]

What do you think - will this become a widespread practice?

I think that what Kalshi has done can also be a consideration for similar prediction platforms to permanently ban their users if they find evidence of market manipulation or other behaviors that could potentially harm the platform.
But, this will not completely eliminate insider trading on their platforms. There will still be people who try to take advantage of the information they have, and they will do their best to avoid detection. However this action is a pretty good effort, at least, those users will no longer be able to use their accounts to participate in event predictions.

[Fiatless]

Kalshi has permanently blocked a user for the first time.

https://www.tradingview.com/news/the_block:87e69f97f094b:0-kalshi-issues-first-permanent-ban-to-former-rep-george-santos-over-state-of-the-union-trading/

He was former congressman George Santos. The platform claims that he traded in contracts for his own appearance at the president’s speech and then tried to influence their price through public statements.
Santos earned $17,839 from the transactions. Now he also faces a fine of $71,556.

Will there be anything related to Polymarket?
What do you think - will this become a widespread practice? If so, will prediction enthusiasts try to bypass them?

Investigation would have to be conducted to ascertain if former congressman George Santos also placed some shady contract on Polymarket. For now only the prediction contracts for Kalshi have been proved that the former lawmakers made money from insider information.

Predictions market platforms have the right to ban any user that violate its laws. George Santos wanted to intentionally cheat the system and make money from information he already knew. More insider bettors should be banned because they are cheating the system.

[CryptoBuds]

What do you think - will this become a widespread practice?

Absolutely! As prediction market grow in size, tendency for insider manipulation is also on rise.

You know, it isn't just Santos, during this same period, Kalshi has also imposed temporary ban on other politician, including gubernatorial candidates in California and Maine!

Whenever the outcome of any event hinges on individual's personal decision, temptation to manipulate market using one's power or social media influence becomes hard to resist. I believe there is a strong likelihood of this becoming a widespread practice in scenarios such as "Will I resign tomorrow?" or "Will I attend a concert?" such type of prediction market.

[MRY]

What do you think - will this become a widespread practice?

I think that what Kalshi has done can also be a consideration for similar prediction platforms to permanently ban their users if they find evidence of market manipulation or other behaviors that could potentially harm the platform.
But, this will not completely eliminate insider trading on their platforms. There will still be people who try to take advantage of the information they have, and they will do their best to avoid detection. However this action is a pretty good effort, at least, those users will no longer be able to use their accounts to participate in event predictions.

Key security benchmark to the digital prediction market industry is imposing penalties, such as banning of permanent accounts, on the perpetrators of market manipulation. Such stringency enhances integrity of the transaction ecosystem against possible fraud that would kill confidence of people. Strict enforcement of rules sends strong point home to everyone using it, about the limits to how the site can be used.

The art of taking advantage of internal knowledge is one such chink in the armor that is hard to remove as much as with the most advanced security systems. Fraudsters will always strive to hide traces of transactions in order to avoid detection by automated detection technology. At least, closing of the problematic accounts blocks the further involvement of the concerned people in the transactions.

[Hispo]

George Santos is a disgrace for American politics, basically a parasite who is trying to live off his lies and from others people money.
He basically managed to get into American politics because of his endless trail of lies and deceit.

I am okey with him getting permanently banned from both Kalshi and Polymarket, as if he participates in those platforms is not in order to get money out of luck and analysis, but rather he would try to abuse in influence and his friendships in Washington to pocket and quick buck.

[GreatArkansas]

(....)
Will there be anything related to Polymarket?
What do you think - will this become a widespread practice? If so, will prediction enthusiasts try to bypass them?

It's already happened, already related to Polymarket, but only in a different form.
Will people try to get around it? -Some will, for sure. Most of the obvious versions will fail.

[Bryan jessy]

Permanently ban? Does such even exist if they are to really ban someone in the prediction market? He was caught in the act because he was not smart enough like his colleagues, but the amount which he staked and won on the game (s) that was made public can never be the only amount which he benefited from the bet, so what they asked him to pay as fine can't be said to be above what he won, and I can never believe that shit of them saying he's ban for life when he has people and means to use his advantage and make money off the market.

Permanently ban is almost impossible because if he can not place a bet he will still have someone to do that for him, such crime like this is difficult to tackle, because the fact that he was the first to be blocked does not mean such act has not been practiced before now the only difference is that he was caught, but others were lucky because they were not caught, things like this do happen in even in our daily life, nowadays people do horrible things and get away with it the moment you decide to try you get caught, if only others who has been in this same act where caught I am sure the rate at which people are manipulating prediction market would have been reducing instead of increasing as it is now.

[uchegod-21]

Permanently ban? Does such even exist if they are to really ban someone in the prediction market? He was caught in the act because he was not smart enough like his colleagues, but the amount which he staked and won on the game (s) that was made public can never be the only amount which he benefited from the bet, so what they asked him to pay as fine can't be said to be above what he won, and I can never believe that shit of them saying he's ban for life when he has people and means to use his advantage and make money off the market.

Permanently ban is almost impossible because if he can not place a bet he will still have someone to do that for him, such crime like this is difficult to tackle, because the fact that he was the first to be blocked does not mean such act has not been practiced before now the only difference is that he was caught, but others were lucky because they were not caught, things like this do happen in even in our daily life, nowadays people do horrible things and get away with it the moment you decide to try you get caught, if only others who has been in this same act where caught I am sure the rate at which people are manipulating prediction market would have been reducing instead of increasing as it is now.

What exactly makes a permanent ban almost impossible, because the cheater can still disguise himself to bet with either thesame prediction market or another one? That is not enough reason. No matter the number of times thesame person tries to cheat the system again by impersonating, whenever he is caught, such accounts involved should be banned permanently until he is exhausted and can no longer introduce more accounts.

People like this are making the prediction markets lose their credibility and purpose. Some countries are already banning prediction markets because of insider trading and manipulation. That is why the prediction markets should be very serious about fishing out these bad eggs and then give them more harsh punishment.