Kalshi-backed prediction market advocacy group debuts with support from former Trump aide

A new advocacy organization focused on prediction markets has emerged as the midterm elections approach and will be supported by former White House Deputy Chief of Staff Taylor Budowich.

On Friday, Kalshi announced that Budowich will be a strategic advisor for Americans for Fair Markets,  a new group which it says will "take on the sportsbook and casino interests that are focused on protecting their monopolies and seeding lies about prediction markets to policymakers." Kalshi is backing the group. 

"We're not going to be outspent or out-organized by entrenched interests protecting their monopolies," said board member John Bivona, head of government relations at Kalshi, in a statement. "Millions of Americans have shown they want regulated, open, and fair prediction markets — and we're going to make sure they have access to them." 

Prediction markets have gone mainstream over the past few years, gaining popularity after the 2024 elections, when retail traders flocked to bet on key races. Since then, platforms such as Kalshi and Polymarket have ballooned and are being valued at tens of billions of dollars each. 

At the same time, regulating prediction markets has become a point of contention between the federal Commodity Futures Trading Commission and state regulators. CFTC Chair Michael Selig has asserted his agency's "exclusive jurisdiction" over prediction markets, despite pushback from states and state gambling regulators who say platforms are violating local gaming and gambling laws, particularly regarding sports bets.

Insider trading concerns

Concerns around insider trading have also grown. On Friday, House Oversight Committee Chairman James Comer launched a congressional probe into insider trading on Kalshi and Polymarket and sent letters to both CEOs as to how the two verify user identities, enforce geographic restrictions and detect anomalous trading activity. 

Both Kalshi and Polymarket have rolled out new tools to curb insider trading. Kalshi said it has a new screening tool to block political candidates from trading on their own elections and Polymarket said it has updated its governing documents, introducing clearer rules around insider trading and enforcement. 

The organization said it will team up with the Coalition for Prediction Markets, which launched last year with members including Kalshi, Robinhood and Coinbase. Former Reps. Sean Patrick Maloney, D-N.Y. and Patrick McHenry, R-N.C. lead that organization. 

AFM's Budowich was working at the White House until last year, where he oversaw communications, speech writing and cabinet affairs. He also oversaw the main pro-Trump super PAC, according to The New York Times.

AFM will focus on exchanges becoming federally regulated, rights for individuals to make their own decisions, as well as a ban on insider trading and no markets that are tied to war, terrorism, death or assassination.

Bets on war-related activities have also drawn scrutiny, particularly raising alarm bells after a Polymarket account, later found to be linked to US Army soldier Gannon Ken Van Dyke, wagered that Venezuelan President Nicolás Maduro would be "out" by a certain time, netting $400,000, sparking concerns of inside information.