It’s totally legal to insider trade on prediction markets as CFTC regulates them as derivatives, not securities. Insider trading rules don't apply here. And here's the point people miss: prediction markets are literally designed to attract insiders. That's the whole point. The market works best when people with real information participate. Average person scrolling Twitter doesn't add much value to predicting complex outcomes. Prediction markets are basically a legal way to buy insider info. Right now everything trades openly, but I'm betting we'll see private markets soon. Invite-only. Qualified buyers. Many companies would pay for those insider news, privately though. Here's where it gets interesting though. People keep demanding CFTC to apply stricter rules. But insider trading was never a problem for regulators, it’s for the whole industry. Stock markets ban it because if regular investors think the game is rigged, they leave. Nobody plays a game they know they'll lose. The exact same problem exists for prediction markets. Why would anyone provide serious liquidity if they know insiders can crush their position without breaking a sweat? It’s the whole industry’s job to find the balance to encourage insider trade while maintaining enough market liquidity from uninformed traders. The insiders make the market accurate, but too many insiders kill the market entirely. It's a sword hanging over the whole model. These platforms need uninformed liquidity, but that money needs to believe it has a chance. Thread that needle wrong and you've got a market with perfect information and zero volume. What do you think happens when more people realize this?