Democrats Target Kalshi and Polymarket After Midterm Sweep

Washington is about to get uncomfortable for prediction markets. According to Politico, Democrats — riding high after their midterm sweep — are vowing to crack down on the industry, putting platforms like Kalshi and Polymarket under a harsh spotlight.

The report names both companies directly as likely targets of that scrutiny. Neither has responded publicly to the threat as of yet.

Prediction markets let users put money on real-world outcomes, from elections to economic data, and they have already logged years of regulatory pushback in the United States. Kalshi fought a lengthy legal battle for the right to list certain contracts, while Polymarket has navigated its own run-ins with watchdogs.

Now the fight moves from agencies to Capitol Hill, where a newly empowered Democratic caucus appears ready to make an example of the sector. What that crackdown looks like in practice — hearings, legislation, or pressure on regulators — is still unclear from the Politico report.

For an industry that thrives on being right about what happens next, this is one outcome the platforms may not have priced in.