Prediction markets platform Kalshi is implementing new verification measures, including a 'portal for parents', to prevent minors from illegally accessing its services. This move follows reports that underage users have been able to bypass the platform's age requirement of 18 by using a parent's identification for verification.
According to a report from Semafor, Kalshi co-founder and CEO Tarek Mansour announced the initiative. "We are also adding selfies to accounts, where you can basically look at the face of a person, and it can tell you obviously if this person is not the actual parent that’s 50 years old," Mansour stated. The portal will allow parents to submit their identification to check if their children are using accounts under their names.
The enhanced compliance controls arrive as prediction markets face increasing scrutiny from US regulators. State-level gaming authorities are examining event contracts related to sports, while federal attention has expanded to include controversial bets on geopolitical and military actions. This regulatory pressure is mounting as the sector grows and crypto-native competitors like Binance and Crypto.com expand into prediction market features.
Legally, Kalshi's position hinges on the argument that its contracts fall under the exclusive jurisdiction of the US Commodity Futures Trading Commission (CFTC), as governed by the Commodity Exchange Act, rather than state gambling laws. This interpretation has received support from CFTC Chair Michael Selig, who filed an amicus brief in a related case involving Crypto.com.
Recent court rulings have provided partial validation for this federal preemption argument. A federal judge in Arizona blocked state officials from enforcing gambling laws against Kalshi's contracts, following a similar decision by a federal appellate court in New Jersey. However, multiple state-level cases remain ongoing, leaving the overall regulatory framework for prediction markets in the United States fragmented and unresolved.
