On May 24, 2026 — the same day House Oversight Committee Chair James Comer announced a congressional investigation into insider trading on prediction market platforms — Kalshi unveiled Americans for Fair Markets (AFM), a new lobbying organization it describes as "well-capitalized" and aimed at countering what it calls gaming-industry misinformation on Capitol Hill.
The simultaneous moves frame the sharpest political confrontation the prediction market industry has yet faced: a federally regulated exchange going on offense at the exact moment Congress escalates scrutiny.
The lobbying group. AFM launches with the backing of Kalshi and, according to a spokesperson, a coalition of other industry stakeholders — though the organization declined to disclose how much funding it has raised. Its stated agenda is to oppose offshore, unregulated alternatives and support a federal framework that includes CFTC oversight, identity verification, and bans on markets tied to war, death, terrorism, and assassination. The group has brought on Taylor Budowich — most recently Deputy White House Chief of Staff under Susie Wiles — as its strategic advisor. AFM's head of government relations is John Bivona, who also serves in that role at Kalshi and previously worked in the Biden administration. "We're not going to be outspent or out-organized by entrenched interests protecting their monopolies," Bivona said in the Kalshi announcement.
The investigation. Rep. Comer sent letters the same day to Polymarket CEO Shayne Coplan and Kalshi CEO Tarek Mansour demanding records on identity verification procedures, geographic restrictions, and how each platform flags anomalous trading activity. Speaking on CNBC's Squawk Box, Comer framed the probe around national security: "There's a concern now that members of Congress, members of the president's administration, any type of government employee, can use basic insider knowledge and make huge profits on anything government-related." He said the investigation would also build a case for legislation restricting participation by government officials.
The arrests behind it. Comer's investigation did not emerge from a vacuum. In recent months, Israeli nationals were arrested for allegedly using IDF military intelligence to place winning bets on Polymarket. A U.S. soldier was separately charged in connection with a $400,000 Polymarket bet on the removal of Venezuelan President Nicolás Maduro. Onchain intelligence firm Bubblemaps identified 80 bets on Polymarket with a 98% win rate — a figure its co-founder Nicolas Vaiman told CoinDesk is "statistically impossible to achieve."
The regulated vs. unregulated divide. Kalshi's central argument is regulatory status. It has operated as a CFTC-regulated designated contract market since 2020, and AFM's materials repeatedly contrast this with Polymarket, whose international platform handles the majority of its volume with no U.S. know-your-customer requirements. Prediction market volumes hit $51 billion last year and could reach roughly $240 billion in 2026, per a Bernstein analysis from April.
The gaming lobby's counter. The industry arrived in Washington this week from multiple directions. On May 21, American Gaming Association president Bill Miller testified before Congress, pushing back on prediction markets' regulatory framing. "These so-called prediction markets are deceptively calling sports betting financial contracts and investing," Miller told lawmakers. "Despite messaging designed to beguile policymakers and the public, they are increasingly being exposed as backdoor sports-betting operations." The AGA, which has former New Jersey Governor Chris Christie as a prominent ally, is pressing for state-level gaming law enforcement rather than federal CFTC preemption.
The week also produced a bipartisan Gillibrand-McCormick bill proposing the first comprehensive federal framework for prediction markets and a heated Senate Commerce Committee hearing where Chair Ted Cruz warned about cheating scandals in professional sports and Senator John Hickenlooper accused platforms of predatory marketing toward young users.
What May 24 made clear: Kalshi is no longer treating Washington scrutiny as a compliance exercise. It is treating it as a campaign.
Sources: Kalshi blog, Americans for Fair Markets announcement; Decrypt, May 24, 2026; CoinDesk, May 22, 2026