Key takeaways: Congressman James Comer, the top Republican on the House Oversight and Government Reform Committee, has broadened an insider trading investigation to cover three prediction trading platforms. Comer sent letters to the chief executives of Hyperliquid Labs, Crypto.com, and Aristotle Exchange Inc., which operates PredictIt, requesting documents related to customer identification as well as materials on how the platforms detect and report suspicious transactions. In May of this year, Comer had already launched a similar investigation into the two largest and best-known prediction trading platforms, Kalshi and Polymarket. On September 9, 2025, in Washington, D.C., Kentucky Republican Congressman James Comer spoke to reporters after a weekly House Republican caucus meeting. House Oversight Committee Chairman Comer is expanding his investigation into insider trading on prediction markets, asking three online platforms to explain their efforts to screen for insider trading. The Kentucky Republican sent multiple letters on Tuesday, first shared with a media outlet, seeking materials from the CEOs of Hyperliquid Labs, Crypto.com, and Aristotle Exchange Inc., which owns the PredictIt platform, requesting details on their identity verification processes and their systems for identifying and preventing insider trading.

In a statement, Comer said: "As online prediction platforms grow and move into the mainstream, some bad actors are using non-public information to place bets and profit, with single trades earning thousands of dollars. The House Oversight Committee is investigating whether these platforms are fulfilling their legal obligations and whether they have taken sufficient steps to identify and stop insider trading in advance." Prediction markets allow users to trade binary event contracts on the outcomes of various future events, covering sports, congressional midterm elections, and even contracts tied to wars and other global events. As the industry expands, these platforms are drawing increasing attention from members of Congress. As early as May of this year, after several widely reported bets on international events, Comer had already opened an investigation into the industry's two leading platforms, Kalshi and Polymarket. A committee spokesperson said the investigation is still ongoing and that nearly 1,000 documents and five briefings have been received from the two companies. In April of this year, a U.S. soldier was accused of using inside information to bet on contracts tied to the ouster of former Venezuelan leader Maduro in January 2026, illegally profiting about $400,000. A May investigation found that more than 80 Polymarket users had trading records with suspicious characteristics, with some trades placed just hours before major geopolitical conflicts broke out. Former New York Republican Congressman George Santos, who was expelled from the House in 2023, was accused of betting on Kalshi about whether he would attend the February State of the Union address, after repeatedly saying publicly that he would be there. Kalshi permanently banned him in August and fined him $71,356. Both Kalshi and Polymarket announced earlier this year that they would strengthen internal anti-insider-trading rules. But trading that raises insider trading concerns is not limited to the leading platforms.

In his letter to Hyperliquid CEO Jeff Yan, Comer cited reports that in October 2025, minutes before the U.S. president's tariff-related announcement became public, someone established a large leveraged short position on the platform. Comer wrote in the letter: "This trade was precisely timed to an undisclosed government decision. The platform appears to have neither implemented identity verification nor a mechanism to refer those involved to U.S. law enforcement. This case fits closely with the insider trading pattern the committee is investigating across the industry." On Tuesday, spokespeople for Hyperliquid, Crypto.com, and Aristotle Exchange did not immediately respond to requests for comment. Comer and the committee are asking the companies for documents and internal communications, seeking details on their know-your-customer (KYC) policies and their internal processes for detecting, investigating, and reporting suspicious transactions.