In just eighteen months, prediction markets have built surveillance systems that took traditional stock exchanges decades to develop. Kalshi, Polymarket, and others now deploy advanced detection engines, encrypted banned-person lists, and partnerships with sports leagues and forensic experts to police trade integrity.
Surveillance Tools Taking Shape
Kalshi leads with its own proprietary engine named Poirot, working alongside Solidus Labs for trade monitoring, IC360 for sports integrity, and the Wharton Forensic Analytics Lab for sophisticated statistical analysis. This network shifted from reactive investigations to proactive blocking, screening athletes, coaches, and officials to prevent conflicts of interest. Traders are barred from betting on races they’re involved in, enforced through encrypted lists built in collaboration with the NHL and IC360.
Polymarket’s approach combines layered surveillance across offshore and U.S. platforms. A key move was its March collaboration with Palantir and TWG AI to monitor sports markets more effectively. Vendors like IC360 and Eventus are merging insider-risk lists with real-time trade monitoring, forming what’s becoming the industry standard.
The Cost of Compliance
Every identity check, employment disclosure, and banned-person list strengthens regulated platforms but pushes marginal volume toward less restrictive venues. This trade-off creates tension between security and participation. Financial markets typically build surveillance after crises, taking decades to develop. The prediction market sector compressed this process dramatically, spurred by congressional scrutiny and rapid market growth.
The result is a complex surveillance stack with names like Poirot, ProhiBet, and HALO, plus whistleblower tools and mandatory disclosures for high-risk traders. These measures aim to ensure integrity but come with hidden costs participants may flee to unregulated platforms that offer easier access.
This content is informational and does not constitute financial advice.
