{"slug": "new-york-city-probes-kalshi-and-polymarket-over-social-harms", "title": "New York City probes Kalshi and Polymarket over social harms", "summary": "The New York City Council is investigating the advertising practices of Polymarket, Kalshi, Coinbase Global Inc., and Gemini Space Station Inc.'s Titan platform over concerns about false or deceptive marketing and social harms, including compulsive wagering. Council Speaker Julie Menin sent a legislative inquiry demanding data on user demographics, marketing spend, and influencer payments dating back to Jan. 1, 2025, with a 14-day response deadline. The probe adds to regulatory pressure on the multi-billion-dollar prediction market industry, which faces lawsuits from New York state and a separate CFTC investigation into Polymarket.", "body_md": "The New York City Council is probing the advertising practices of four major prediction market platforms, creating a new front in the legal battles facing the booming industry.\n\nNew York City Council Speaker Julie Menin sent a lengthy list of questions to Polymarket, Kalshi, [Coinbase Global](https://fortune.com/company/coinbase/) Inc. and Gemini Space Station Inc.’s prediction market platform, Titan, as part of a so-called legislative inquiry examining whether current city laws adequately protect residents from false or deceptive marketing from the new platforms.\n\nThe council is also looking at creating policies to address products offered to people who might “engage in compulsive wagering on event contracts.”\n\n“The Council is investigating allegations involving Polymarket and, critically, the extent to which similar marketing practices are prevalent within the prediction market industry more broadly, and related social harms to City residents,” the letter to Polymarket said.\n\n“We look forward to engaging with The New York City Council on this matter,” a spokesperson for Polymarket said.\n\nThe other firms didn’t immediately respond to requests for comment.\n\nThe inquiries come as prediction markets have grown into a multi-billion dollar industry by offering financial contracts tied to everything from celebrity news to when the Strait of Hormuz will reopen. [Wagers on sports](https://www.bloomberg.com/news/articles/2026-07-19/prediction-markets-swell-to-27-of-sports-bets-during-world-cup) dominate prediction market trades and stand at the [center of a wide-ranging fight](https://www.bloomberg.com/news/articles/2026-08-07/cftc-warns-prediction-markets-against-american-style-casino-odds) over how to regulate the industry.\n\nThe platforms and the Commodity Futures Trading Commission, the federal regulator that oversees derivatives trading, have argued that event contracts are financial instruments that are fundamentally different from gambling and should fall under federal oversight. States, [including New York](https://www.bloomberg.com/news/articles/2026-07-31/new-york-sues-kalshi-for-running-illegal-gambling-operation), have disputed that idea and sued the firms, alleging the platforms amount to illegal, unlicensed gambling operations.\n\nThe CFTC on Tuesday [ordered](https://www.bloomberg.com/news/articles/2026-08-11/cftc-orders-kalshi-to-keep-operating-despite-new-york-suit) Kalshi to continue operating in New York despite the state’s effort to shut down its operations.\n\nThe CFTC is conducting its own [investigation](https://www.bloomberg.com/news/articles/2026-06-26/cftc-conducting-broad-probe-into-prediction-market-polymarket) of Polymarket, looking at the firm’s social media activity and other issues, Bloomberg has reported. The Wall Street Journal reported in June that the company hired dozens of mostly college-aged social media creators to film themselves making fake profitable trades that were used to attract users to the platform.\n\nThe New York City Council letter references “troubling” news reports alleging Polymarket conspired with influencers and marketing agents to “target young adults — and thus potentially minors — with false, deceptive, and unconscionable advertising.”\n\nThe platforms are being asked to provide information going back to Jan. 1, 2025 on the number of users in the state, the age and demographics of customers and how much money New York City residents have won or lost. Other questions focus on how the firms advertise to New Yorkers, how much they pay influencers and how effective their marketing has been in capturing younger users.\n\nThe firms were given 14 days to respond. The council said it also plans to hold public hearings on the topic.\n\n*breaks the traditional barrier between audience and newsroom. The show transforms*\n\n**Fortune Daily*** Fortune*’s trusted reporting into actionable, conversational, and entertaining insights for an emerging class of business leaders.\n\n**Watch here.**", "url": "https://wpnews.pro/news/new-york-city-probes-kalshi-and-polymarket-over-social-harms", "canonical_source": "https://fortune.com/2026/08/12/kalshi-polymarket-nyc-probe/", "published_at": "2026-08-12 14:58:10+00:00", "updated_at": "2026-08-12 15:16:19.396530+00:00", "lang": "en", "topics": ["ai-policy"], "entities": ["New York City Council", "Julie Menin", "Polymarket", "Kalshi", "Coinbase Global Inc.", "Gemini Space Station Inc.", "Titan", "Commodity Futures Trading Commission"], "alternates": {"html": "https://wpnews.pro/news/new-york-city-probes-kalshi-and-polymarket-over-social-harms", "markdown": "https://wpnews.pro/news/new-york-city-probes-kalshi-and-polymarket-over-social-harms.md", "text": "https://wpnews.pro/news/new-york-city-probes-kalshi-and-polymarket-over-social-harms.txt", "jsonld": "https://wpnews.pro/news/new-york-city-probes-kalshi-and-polymarket-over-social-harms.jsonld"}}