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This is our roundup newsletter. A weekly curated list of the biggest things happening in prediction markets.
This edition was written and researched by Omar El Safy and Pet Berisha.
Last week we published Is the Fee-Free Era Over for Market Makers?, on why DKeX and Polymarket US have started charging the trading firms they used to pay.
Pete Hegseth has banned everyone at the Department of War from trading on information they get through the job, and his memo names Polymarket and Kalshi.
The memo went out to senior Pentagon leadership and every combatant command. It covers classified and unclassified information, on "all financial platforms, including traditional betting platforms and prediction markets such as 'Polymarket' or 'Kalshi.'"
Service members can still trade, as long as it isn't on anything connected to their work. Anyone who breaks the rule can face disciplinary action or criminal charges under the Uniform Code of Military Justice (UCMJ).
In Hegseth's words, "Our enemies watch movements in these markets. When an American Service member, intelligence professional, or other Department civilian engages in a financial transaction on a military outcome, they create a signal."
The memo follows the case of Army Master Sgt. Gannon Ken Van Dyke, a Special Forces soldier who put about $33,000 on Polymarket markets on Nicolás Maduro's removal between 27 December 2025 and 2 January 2026. US forces captured Maduro the next day, and Van Dyke's bets paid out more than $400,000.
He was charged with five federal counts in April 2026, including commodities fraud and wire fraud.
Utah's attorney general Derek Brown sued Kalshi, and Susquehanna, their main market maker, in state court in Salt Lake County on Tuesday.
The complaint estimates Kalshi took between $30.6 million and $61.2 million in fees from Utah accounts, working from roughly 3.06 billion trades at one to two cents each. Utah want that money back, plus punitive damages and an injunction enforced by a court-approved geolocation provider.
"Kalshi runs an online casino in Utah and calls it a prediction market. That violates Utah law," Brown said.
Kalshi lost their own federal case against Utah in August 2026, when Judge Robert Shelby ruled the Commodity Exchange Act (CEA) doesn't override Utah's gambling ban. Their appeal sits with the Tenth Circuit, which refused to pause that ruling in September 2026.
Kalshi say they are "a national derivatives market overseen by the CFTC" and that "no single state should have a veto over it."
Ohio have gone after the businesses working with the exchanges instead. The Ohio Casino Control Commission (OCCC) told everyone it licenses for sports betting, from suppliers to integrity monitors, to stop working with prediction markets that offer sports contracts in Ohio, or risk losing their licences.
Polymarket US have already sued Ohio in federal court, arguing the CEA pre-empts Ohio's gambling law.
And in New York, the Gaming Commission asked a Manhattan court to force Kalshi to hand over records it subpoenaed in July 2026, including on users under 21.
Kalshi are pitching banks and hedge funds on futures that track US inflation, and are aiming to launch in December 2026, Bloomberg reported.
The contracts would follow headline CPI and core CPI (which leaves out food and energy), trade 24 hours a day from Sunday to Friday, and clear through Kalshi Klear. Kalshi already list CPI event contracts, which pay out if a print lands above or below a set number. These would be futures with dates attached, covering the next 12 monthly prints, then May and November contracts for four years after that.
Kalshi have tapped Michael Ashton, a former Barclays trader known as the "Inflation Guy", to design them.
"There's no exchange that trades this, and they want to be the inflation exchange," Ashton said.
Bloomberg put the market Kalshi are going after at about $7.6 trillion, made up of $2.2 trillion of Treasury Inflation-Protected Securities (TIPS) and $5.4 trillion of inflation swaps traded privately between institutions.
Kalshi confirmed they're working on the product but haven't given a date, and no CFTC filing has been made public.
They also asked the CFTC this week to let them relist compute contracts on the future cost of renting GPUs. Kalshi also hosted its first tungsten hedge for an Ohio-based metals distributor, arranged by commodity-risk firm Pillar, with Susquehanna making the market.
Polymarket have fired Matthew Modabber, their chief marketing officer since January 2024 and a friend of CEO Shayne Coplan since high school, the New York Post reported.
The Post's sources say the board decided Modabber was getting in the way of Polymarket looking less like a scrappy startup as they weigh an IPO.
It follows an internal review into a run of marketing controversies. In June 2026, the Wall Street Journal reported that Modabber's team built a fake webpage to promote videos of users making money on phony trades, and the CFTC opened an investigation. Politico later found more than $2.5 million sent from Modabber's personal PayPal account to more than 800 people between January 2025 and February 2026, at least $350,000 of it to influencers.
📊 This Week's Volumes
Source: The Prediction. Notional volume on US-regulated venues, week to 23rd October 2026 versus the week before. † Novig is US-based but not CFTC-cleared
Source: The Prediction, Artemis. Volume on offshore and on-chain venues, week to 23rd October 2026 versus the week before
🗞 General
More than $1.4 billion has traded on 2026 midterm markets, with Kalshi at nearly $1.1 billion and Polymarket at more than $340 million across their US and international exchanges, CNN found. (Read more here)
Bank of America say prediction markets traded $28 billion this week, nearly 30 times the level a year ago and a pace of about $1.5 trillion a year. Analyst Julie Hoover put Kalshi's US share at 75% to 80% at NEXTPredict NYC. (Read more here)
Stifel find prediction markets grew slower than sportsbooks in September 2026 once you only count the side placing the bet, with that volume up about 27% on August compared to 43% for regulated sportsbook handle. Kalshi's share fell to 79% from 86%. (Read more here)
DraftKings' exchange DKeX ranked third by volume ($DKNG ( ▼ 0.17% )), trading more than $3 billion in the week to 18 October 2026, behind Polymarket International and just ahead of Novig, in Aldrin Research data. (Read more here)
A Tel Aviv University study of 1,014,122 forecasts found prediction markets well calibrated overall, across Polymarket, Kalshi, Manifold and Metaculus. Markets overestimated military conflict and technology events, and underestimated some election outcomes. (Read more here)
Kalshi have pulled out of China, India, Brazil and Nigeria, Sportico reported, while Matchbook, licensed in the UK and Mexico, apply to the CFTC. Matchbook CEO Ronan McDonagh said, "You can only go so long bullying your way into other people's worlds." (Read more here)
Kalshi, Polymarket and their founders have given at least $5 million to political groups this cycle, $2.7 million of it to Republicans, including a previously unreported $1 million from Polymarket to the Democratic House Majority Forward, Reuters reported. (Read more here)
Danny McBride and Shane Gillis play rival weathermen in a four-minute Kalshi ad, written by McBride, with a shorter cut airing during Game 1 of the World Series. (Read more here)
🤝 Announcements & Partnerships
Phantom roll out Kalshi markets to US users, funded in CASH, Phantom's dollar stablecoin, at $0.02 a contract, with some categories restricted in Michigan, Nevada and Washington. (Read more here)
Kalshi launch sector KPI markets with Carbon Arc, on industry-wide card spend, point-of-sale data, foot traffic and app downloads, settled on Carbon Arc's data. (Read more here)
IG Group plan to launch UK financial prediction markets in Q4 2026, which they bill as the UK's first 24/5, tax-free, regulated financial prediction markets. They have also applied for a Gambling Commission licence. (Read more here)
💰 Funding & M&A
InsightX close a strategic round from Aurumx Capital and Becker Ventures, taking the AI prediction market's total funding to $7.4 million. (Read more here)
⚖️ Regulation & Legal
Kalshi sue Louisiana's attorney general, governor and gaming board in federal court, saying the state will imminently move against their event contracts. It is the first prediction market case in the Fifth Circuit. (Read more here)
The Commodity Markets Council urged the CFTC not to approve Kalshi's perpetual oil future, filed on 20 October 2026. The group, whose members include CME and ICE Futures US, also wants the CFTC to stop US retail traders reaching offshore platforms. (Read more here)
The CFTC told Novig not to list micro contracts, like which team scores first in a basketball game, citing manipulation risk. It also found ProphetX's "scorigami" contracts, which pay out on a final score never seen before, don't meet the Commodity Exchange Act's definition of a swap. (Read more here)
CFTC Chair Mike Selig says the agency is watching election contracts for manipulation ahead of the 3 November 2026 midterms. "Whether there's manipulation in the markets or any other type of nefarious activity, we're going to catch it," he told Bloomberg. (Read more here)
A federal judge let Buena Vista Rancheria join the tribal lawsuit against Kalshi and Robinhood ($HOOD ( ▼ 2.08% )) in Northern California, with an amended complaint due 4 November 2026. (Read more here)
Rep. Byron Donalds says the CFTC will largely win its fights with the states, and called the CLARITY Act "about as good as you can get with the current iteration of Congress." (Read more here)
Predicted is written by Pet Berisha and Omar El Safy. Every edition, our quarterly State of Prediction Markets reports and more at predicted.co.
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This newsletter is for informational purposes only and is not financial, business or legal advice. These are the author's thoughts & opinions and do not represent the opinions of any other person, business, entity or sponsor. Any companies, platforms, markets or projects mentioned are for illustrative purposes unless specified.
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When you trade on prediction markets (including event contracts, opinion markets and other speculative instruments) your capital is at risk. Risks include price volatility, loss of capital, illiquidity, complexity, evolving regulation and lack of protection. Many prediction market operators do not currently operate in a fully regulated industry, and availability varies by jurisdiction. You may not be protected under financial compensation schemes typically afforded to investors dealing with regulated entities. Nothing in this newsletter constitutes a recommendation to place, hold, or close any position on any market.
