Gov. Gavin Newsom Might Be Getting Ahead On Winning Issue
Gavin Newsom put his finger in the wind and realized that the political gusts were blowing in the direction of a massive crackdown on corruption.
Newsom signed an executive order Friday prohibiting state officials from using inside information to place bets on prediction market platforms, including Polymarket and Kalshi. While these are practically gambling venues, they are technically different from DraftKings or FanDuel because they allow users to exchange “contracts” on future events outside of sports, such as if/when the United States will put its troops on the ground in Iran. As a Polymarket user you do not bet against the house; you are trading against the market – against other traders. (RELATED: CNN Just Opened Pandora’s Box, It’s Worse Than Any Fake Hoax)
“At a time when Trump’s Washington is riddled with ethical failures and internal profiteers, California draws a clear line,” he said in a statement. “We are not going to tolerate this kind of corruption in California.”
The administration was accused of insider trading over massive and suspicious oil operations, just before President Trump said Monday that “productive conversations” were underway between the United States and Iran. This is the kind of news that pushes oil prices lower because it suggests a ceasefire is on the horizon. The transactions were collectively worth $580 million.
Will @CAGouverneur Gavin Newsom bans CA officials and appointees from betting on prediction markets with inside information in the next 24 hours?
Can we have any chances for this? 👀 @Polymarché @Kalshi
– Governor Newsom Press Office (@GovPressOffice) March 26, 2026
Because prediction markets are relatively new, it has taken some time for state governments and regulators to catch up. This means that at present, prediction markets remain an insider trader’s perfect dream. That being said, Polymarket and Kalshi have updated their policies to combat insider trading.
Overall, anti-corruption policy appears to be a big bipartisan winner. For example, no American – except those who profit from corruption – believes that members of Congress should be allowed to trade stocks while in office. They will likely feel the same way about banning government officials from using prediction market platforms. (RELATED: What’s So Special About Nancy Pelosi’s Stock Trading Activities?)
Like Newsom, a group of bipartisan senators has already taken steps to get ahead of the problem.
Democratic Senators Elissa Slotkin and Adam Schiff of California, along with Republican Senators Todd Young of Indiana and John Curtis of Utah, introduced the Financial Markets Public Integrity Act of 2026 on Thursday. The proposed ban would apply to the president, vice president, members of Congress and their staffs, as well as political appointees and staff of independent executive and regulatory agencies. It also defines inside information as non-public data that “a reasonable investor would consider material” when deciding on a transaction, according to Politico.
Young said recent trading in the prediction market has “raised real concerns that individuals with access to sensitive, non-public information could exploit this advantage for financial gain.”
“This is a common-sense step to protect taxpayers and promote the integrity of government,” the Indiana senator said.
