The U.S. Commodity Futures Trading Commission (CFTC), which oversees prediction markets, is speeding up its crackdown on insider trading in prediction markets. It is also tracking traders who use VPNs in the United States to secretly access overseas prediction market platforms such as Polymarket.

A recent Ars Technica report citing Wired said CFTC Chairman Michael Selig said, "We will definitely find them and take action."

Selig said the CFTC, which is currently short-staffed, is hiring more personnel. Like other organisations, the CFTC is introducing AI automation tools that analyse patterns and detect potential manipulation to handle a growing workload. "The data is vast," Selig said. "If you feed it into AI, you get great information. It helps identify where to investigate and when to send subpoenas to traders," he said.

In addition to its in-house surveillance system, the CFTC is also using external tools including blockchain tracing tool Chainalysis for crypto platforms and Nasdaq SMART, market abuse detection software for centralised markets.

Kalshi, a U.S.-based prediction market exchange, announced it had suspended and punished customers caught for insider trading and market manipulation. Polymarket also announced a partnership with Chainalysis in April after backlash intensified over insider trading allegations.