The US Commodity Futures Trading Commission (CFTC) has privately warned Kalshi, the prediction markets operator, that it could face enforcement charges following a months-long review of its contract filings, according to a report by Politico published on Tuesday. The probe examines whether the company properly notified the agency about new products before offering them to traders.

A person with direct knowledge of the matter said the agency delivered its warning privately rather than through a public statement. The report was highlighted in a post on X by Coin Bureau:

“BREAKING: CFTC warns Kalshi of potentially imminent charges over failure to notify regulators of new products, per Bloomberg. The US Commodity Futures Trading Commission (CFTC) has reportedly warned prediction market platform Kalshi that it could SOON face enforcement charges… pic.twitter.com/33x2vHkwv1”

— Coin Bureau (@coinbureau) November 11, 2026

According to the same person, the dispute could still be resolved through a settlement. No formal charges have been announced so far, and the CFTC has not identified the contracts under review or disclosed any proposed penalty.

Conflicting Accounts Over Scope

Kalshi characterized the matter as minor. Spokesperson Elisabeth Diana described it as “a procedural error involving the submission of a handful of contracts, many of which weren’t live,” adding that the company is “already addressing the issue.”

The person familiar with the probe, however, said the notification problems span dozens of products. That gap between the two accounts has not been settled in public, and the CFTC did not immediately respond to requests for comment.

Kalshi operates a CFTC-regulated exchange that offers contracts on the outcomes of elections, financial markets, sports, and other real-world events.

The Self-Certification Question

The investigation centers on self-certification, a process that allows regulated exchanges to list certain derivatives without the CFTC approving each contract individually. Under this framework, exchanges must still notify the agency and certify that their contracts comply with the rules. Those rules include providing details on how a contract settles, and exchanges must also assess whether a contract could be vulnerable to manipulation. The CFTC expects to receive that information before trading begins. Because that notification requirement governs how new contracts reach traders, it sits at the center of how Kalshi has scaled its lineup of political, sports, and financial markets.

On July 24, the agency’s Division of Market Oversight issued an advisory to exchanges on precisely this topic. The guidance raised concerns about filings that bundle many possible contracts into a single submission with broad, template-style language, stating that such certifications “should not be submitted.” At the same time, the advisory still permits closely related contracts to be certified together under certain conditions. It did not name Kalshi, addressing instead the filing practices of designated contract markets in general.

CME Group CEO Terry Duffy has separately questioned whether some event contracts carry sufficient protections against manipulation. Self-certification has become a flashpoint in the wider debate over prediction markets as exchanges continue to add new political, sports, and financial contracts.

A Broader Regulatory Push

The warning arrives as the CFTC works to establish its exclusive authority over prediction markets, including by challenging state-level efforts to regulate Kalshi. Several states contend the company must comply with local gambling laws for certain contracts, while Kalshi maintains that its products are federally regulated derivatives. How that conflict resolves will determine whether prediction markets operate under a single federal framework or a patchwork of state gambling rules.

Politico also reported that Democrats plan stepped-up congressional oversight of prediction markets when the next Congress convenes. The party won the November midterm elections.

Kalshi prevailed in a legal fight against the CFTC in 2024 over political event contracts, and its roster of available markets expanded in the aftermath. On Monday, the company joined Coinbase and four other firms in asking to file a brief backing the CFTC. The brief concerns a case over perpetual futures tied to individual US stocks.

In October, Kalshi completed a $1 billion funding round at a $40 billion valuation, with Wellington Management and Sequoia Capital co-leading the investment. The funding milestone came just weeks before the regulator’s warning surfaced.

Polymarket Faces Its Own Review

Polymarket, a rival prediction market platform, faces a separate CFTC probe. The agency is examining whether the platform adhered to the limits imposed by its 2022 settlement, including measures intended to keep US users out. In January 2022, Polymarket paid a $1.4 million civil penalty for running an unregistered facility offering event-based binary options.

No final decision has been announced in either investigation. Near-term markers include whether the Kalshi matter ends in a settlement, whether the CFTC identifies the contracts under review and any proposed penalty, and how Democrats’ promised congressional oversight unfolds when the next Congress convenes.