What is Prediction Markets Compliance?

Prediction markets let employees take financial positions on corporate developments, economic announcements, regulatory decisions, and other events that can intersect with information they encounter through their work. For financial services firms, risk can arise when employees have access to confidential information, are involved in a related transaction, or have a professional or personal connection to the outcome. 

With direct connections to Kalshi and Polymarket, MyComplianceOffice enables firms to manage employee prediction market compliance on the same platform used to oversee personal trading in traditional securities and digital assets, with prediction market activity in the same employee records compliance teams already use. 

With MCO, firms can strengthen prediction market oversight across key areas:

  • Identify potential misuse of confidential information: Review event contracts where employees may have advance knowledge of deals, financial results, regulatory decisions, or other events.
  • Assess potential conflicts of interest: Consider an employee’s connection to an organization or event, including whether they may be able to influence the outcome.
  • Increase visibility into employee activity: Capture prediction market activity that often sits outside traditional broker feeds and reporting processes.

Capture Prediction Market Activity for Compliance Review 

MCO connects directly to Kalshi and Polymarket and captures employees’ trades and holdings automatically for compliance review. This gives compliance teams a record of prediction market activity and reduces reliance on self-reported or manual reporting. 
 
In MyComplianceOffice, prediction market trades can be reviewed alongside traditional securities and digital asset trading in the same employee compliance environment. This gives a more complete view of employee trading activity without adding another system or a separate supervision process. 

Apply Your Policies to Prediction Markets 

MCO brings prediction market activity into established employee compliance workflows, giving compliance teams a consistent way to apply firm requirements and identify activity that may need further attention.

Firms decide whether prediction market activity is permitted, restricted, or prohibited under their policies. MCO gives them the captured activity and review workflow to put those policies into practice.

Firms can incorporate these requirements into processes for:

  • Account disclosure and connection
  • Review of captured trades
  • Escalation and documentation

MyComplianceOffice maintains the documentation, timestamps, and disposition history needed to demonstrate how activity was assessed and resolved. Firms can address prediction markets within existing personal trading processes rather than creating a separate compliance framework.

MyComplianceoffice Brings Prediction Markets into Scope in Three Steps. 

Low disclosed volume isn’t the same as low exposure. MCO captures activity at the venue, closing the gap between what employees declare and what they trade.

  1. Account Connection: Employees link their Kalshi and Polymarket accounts using MCO’s secure connection flow.
  2. Automatic Overnight Capture: Trades and holdings are collected automatically every night, with duplicate protection, so compliance sees activity without relying on employees to declare it.
  3. Review Like Any Other Personal Trade: Compliance reviews prediction market trades as regular MCO trades, with the event shown as the security description.

Prediction markets are managed through MCO’s Digital Asset Personal Trading solution. Alongside the Kalshi and Polymarket connections, MCO’s 300+ wallet connections also capture on-chain prediction positions held outside the exchanges.

With MCO, firms get one view of exchange and on-chain prediction activity. Prediction market activity lands in the same employee record and trade review workflow as every other personal trade.

How does MCO support prediction market compliance?

MCO brings prediction market activity into the same platform used to manage other employee compliance activity, so compliance teams can review it alongside employees’ securities and digital asset trading.

FAQs 

What is prediction market compliance?
Prediction market compliance involves overseeing employee activity in prediction markets and applying relevant firm policies and controls to that activity.

Which prediction markets does MCO support?
MCO connects directly to Kalshi and Polymarket and can capture on-chain prediction positions through its 300+ digital asset wallet connections.

How can firms monitor prediction market activity?
MCO captures trades and holdings from Kalshi and Polymarket automatically every night, enabling firms to review prediction market activity within their existing employee compliance environment.