Kaslhi is expanding its events contracts into brokerage platform DriveWealth, coming as the prediction market faces scrutiny over insider trading cases involving a politician and an employee of MrBeast, the YouTube influencer entering financial services.
DriveWealth, a registered broker dealer regulated by FINRA, announced Thursday that its API-based B2B brokerage platform will now be integrated with Kalshi, which lets users bet on daily outcomes across the economy, sports, weather, and pop culture events. The partnership comes just one day after news that Kalshi fined former California gubernatorial candidate Kyle Langford and Beast Industries video editor Artem Katpur.
“DriveWealth was built to power the future of global investing through scalable, API-driven technology, and Kalshi’s forward-thinking approach to market design makes for a natural fit. Together, we’re uniquely positioned to equip our partners with the latest financial innovations and next-generation market access for their clients,” stated DriveWealth CEO Naureen Hassan.
Coinbase and Robinhood are among the biggest financial firms to have integrated prediction markets from Kalshi. Other brokerage giants such as Schwab are monitoring the prediction markets space despite Schwab CEO Rick Wurster warning of the industry’s blurring lines between investing and gambling.
Kalshi said Wednesday that a former gubernatorial candidate for California, revealed to be Langford, traded about $200 on his candidacy and then posted about his bet on social media Kalshi fined him $2,000 and gave him a five-year ban from the platform. Katpur wagered around $4,000 on prediction markets related to MrBeast’s YouTube streaming videos, which Kalshi says its surveillance systems flagged for “near-perfect trading success.”
The prediction market suspended Katpur for two years and issued him a $20,000 fine for violating insider trading rules. The CFTC issued a prediction markets advisory over the two disclosed issues of insider trading at Kalshi.
Beast Industries CEO Jeff Housenbold said in an interview with CNBC that it suspended an employee as it internally investigates allegations of insider trading on prediction markets. The Kalshi controversy comes as MrBeast, whose real name is Jimmy Donaldson, had his Beast Industries company fintech app Step deliver banking services and education to young people.
“We’re going to take what is traditionally dry information around financial literacy, make it entertaining, gamify it, and help drive the habits that lead to long-term success for the masses,” Housenbold said on CNBC.
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