Kalshi may have its own version of the Pete Rose scandal, as the prediction exchange said its compliance and surveillance teams would “act accordingly” — but did not specify what that means — after California gubernatorial hopeful Kyle Langford bet on himself to win the state’s 2026 election.
A representative for the business appeared to suggest that the prediction exchange has launched an investigation into the politician’s bets, though a spokesperson declined to confirm or deny whether this was the case.
Langford, a Republican and self-described “Christian Eco-Nationalist,” is the executive director of the California First PAC. He announced his intention to run for election in February.
May 24 on the social-media site X, Langford posted a screen recording showing a $100 bet being placed on himself to win the election. At 6% odds, the bet would paid out $1,330 if it were to win.
“I just bet $100 that I, Kyle Langford will be the next Governor of California, join me (if you believe) @Kalshi,” the post said.
With supporters appearing to also place bets, Langford’s odds rapidly rose, reaching as high as 28%, which made the previously little-known candidate the favorite to win the election. However, his odds drifted over the following days and returned to 6%.
Kalshi compliance team ‘acting accordingly’
The bet appears to break Kalshi’s rules about participants betting on events they are involved in.
“If a trader is a decision maker, either directly or indirectly, or has any influence, either directly or indirectly, no matter the scale and importance of the influence, on the outcome of the underlying (event) of any contract, that trader is prohibited from attempting to enter into any trade or entering into any trade, either directly or indirectly, on the market in such Contracts,” Kalshi’s rules say.
Kalshi responded to the issue with a message on Discord from one of its staff members.
“We are aware of the recently publicized circumstance regarding a candidate trading on a market regarding their candidacy, and our compliance and surveillance teams are acting accordingly,” the message read. “As required of all CFTC-regulated exchanges, Kalshi investigates and, as appropriate, adjudicates all potential violations of its Rules, which are available at https://kalshi.com/regulatory/rulebook.
“Kalshi does not give public comment on the status of ongoing investigations. The outcome of such an investigation, or any pursuant notice of charges or discipline, may become public via exchange notice.”
A Kalshi spokesperson declined to comment further, including to confirm whether the statement meant an investigation was indeed underway.
Insider betting scandals in sports
Insider betting at sportsbooks has been the subject of a number of sporting scandals. Perhaps most notably, Pete Rose was banned from baseball and ineligible for the Hall of Fame — until earlier this month — after a 1989 report determined that he bet on games as a player and a manager. Rose’s bets included wagers on his own team, the Cincinnati Reds, to win.
More recently, NFL wide receiver Calvin Ridley was suspended from the league in 2021 for gambling on NBA and NFL games, including bets on his then-team the Atlanta Falcons. In 2023, the NFL suspended 10 players for gambling offenses, including seven who were determined to have bet on NFL games.
CFTC chair pick to quit Kalshi board
The news comes as President Trump’s pick for chair of the Commodity Futures and Trading Commission (CFTC) — Kalshi board member Brian Quintenz — promised to quit his director role and divest his stock in the business once he is confirmed.
In an ethics agreement letter dated May 21, addressed to John Einstman, the CFTC’s designated agency ethics official, Quintenz addressed the potential conflict of interest that could come from chairing the body that regulates Kalshi.
“Upon confirmation, I will resign from my position with KalshiEx,” Quintenz wrote. “I hold stock and unvested stock options, which vest on a monthly basis, with KalshiEx. I do not hold any other equity interest in KalshiEx. I will forfeit all KalshiEx stock options that are unvested at the time of my resignation. I will divest any vested stock options and stock in KalshiEx as soon as practicable, but not later than 90 days after my confirmation.”
Quintenz is currently awaiting a hearing in front of the Committee on Agriculture, Nutrition, and Forestry.
