New York and Illinois moved in the same week to restrict insider-style trading on prediction markets by public officials. New York Governor Kathy Hochul signed EO 60 on April 23, while Illinois Governor JB Pritzker signed EO 2026-04 on April 21. Both orders prohibit state employees from using confidential information obtained through their jobs to place bets on prediction markets or event-contract platforms, and they also ban helping others profit from such information. Violations can lead to dismissal and law-enforcement action.
Two governors, one message on confidential information
Hochul described New York’s action as a first-in-the-nation ethics measure and framed the issue in blunt terms. In her statement, she said that getting rich by betting on inside information is corruption, plain and simple. She also criticized the federal executive branch for allowing prediction markets to become an “ethical Wild West” without meaningful ethical standards. Pritzker took a more institutional line, saying Illinois is reinforcing its commitment to transparent and ethical government as online prediction markets and event betting grow quickly.
Suspicious trades cited in New York’s order
New York’s EO 60 pointed to two trading episodes as part of its rationale. One involved a Polymarket bet placed just hours before news became public that Venezuelan leader Nicolás Maduro had been captured by U.S. forces. According to the order, a user placed a large wager on “yes” at very low odds and ultimately made about $400,000. The second case involved unusual trading activity tied to a contract related to Iran’s Supreme Leader Ayatollah Ali Khamenei in February. The order did not say either case proved insider trading, but it treated both as evidence that the risk is real.
State pressure is building across the sector
The new orders fit into a broader wave of state-level action. California last month barred appointed state officials from participating in prediction markets. New York’s Gaming Commission had already issued a cease-and-desist order to Kalshi in October 2025, arguing that it was operating sports betting without a license. At the same time, Kalshi’s legal fight with the Nevada Gaming Control Board is still active, and a lower court has temporarily blocked its operations in the state.
That state pressure stands in contrast to the federal view. CFTC Chair Selig has maintained that the federal government has exclusive jurisdiction over prediction markets, and the Trump administration has backed industry players in several lawsuits. New York and Illinois are clearly not waiting for a federal settlement before acting on their own ethics rules.
Record volume raises the stakes in the legal fight
The scale of the market is adding urgency. Token Terminal data cited in the report shows global prediction-market volume reached $2.36 billion in March, marking the seventh straight month of record activity. As more money flows through these platforms, the question of who regulates them — and how insider trading should be defined in this context — is becoming harder to avoid.
Coinbase Chief Legal Officer Paul Grewal said the split between federal and state approaches could eventually push the matter to the U.S. Supreme Court. A final ruling there could determine both regulatory authority over prediction markets and the standards for insider-trading enforcement. For now, the executive orders in New York and Illinois are already in effect.