Author: Frank, PANews
On February 25, 2026, the prediction market platform Kalshi issued a fine of $20,397.58 to a YouTube editor. This precise figure marks the first publicly recorded insider trading fine in the history of the prediction market industry.
The fined individual is Artem Kaptur, a visual effects editor for the world's largest internet celebrity MrBeast. He invested about $4,000 in trading MrBeast-related YouTube event contracts on Kalshi, earning $5,397.58. However, this unremarkable profit triggered a regulatory alarm at the industry level, leading the CFTC (Commodity Futures Trading Commission) to release a formal enforcement advisory regarding prediction markets.
However, Kalshi is a real-name KYC platform, making it relatively easy to catch an editor trading under their real identity. The real question arises: what would happen if individuals with the same information turned to Polymarket, which does not require identity verification? PANews’ analysis found that in the Polymarket contract for the second season of MrBeast's reality show "Beast Games," the winning probability of the ultimate champion was pushed to 94% three weeks before the season ended, displaying characteristics of textbook insider trading.
PANews will analyze the implications of Kalshi's penalty, in conjunction with the on-chain data anomalies from Polymarket, to explore how insider trading has transformed from a Wall Street-exclusive term into a gray game that even editing assistants can participate in during the era of “where everything can be bet on.”
The First Insider Trading Fine in the Prediction Market
According to Kalshi’s disciplinary notice, Kaptur exploited his position at Beast Industries to trade event contracts related to the MrBeast channel between August and September 2025.
Kalshi's monitoring system detected extremely anomalous statistical characteristics: Kaptur achieved an "almost perfect trading win rate" in low-odds markets. At the same time, due to Kalshi's fully public trading data, several platform users noticed this anomaly and actively reported it. Under this double trigger, Kalshi froze Kaptur's account and initiated an investigation. The final penalty included the confiscation of all illegal gains of $5,397.58, plus a punitive fine of $15,000, totaling $20,397.58, with a two-year ban from the platform.
On the same day, another more absurd case was reported. California Republican gubernatorial candidate Kyle Langford bet about $200 on himself to win on Kalshi and then flaunted a screenshot of the trade on X. Kalshi froze his account that day, ultimately banning him for five years and imposing a $2,246.36 fine.
The amounts of these two fines are not substantial, but their signaling significance far exceeds the amounts themselves. The CFTC issued a formal enforcement advisory the same day, explicitly citing Section 6(c)(1) of the Commodity Exchange Act, pointing out that both cases may constitute federal-level illegal conduct. CFTC Chairman Mike Selig stated on X: "Our exchange is the first line of defense against insider trading in prediction markets. If you attempt manipulation, fraud, or insider trading, we will find you and take action." This marks the first direct warning from a U.S. federal regulatory agency regarding insider trading in prediction markets.
Beast Industries issued a statement that it adopts a "zero tolerance" approach to insider trading by employees and has initiated an independent internal investigation. However, the company also suggested that Kalshi should communicate investigation results "more openly" in the future.
However, these efforts rely on one premise: Kalshi is a centralized KYC platform with users' identities, bank transactions, and IP addresses clearly visible. Catching an editor trading under their real name does not reveal much. The real issue is: what if individuals with the same information choose a platform that does not require identity verification and allows anonymous wallets and USDC settlements?
94% on Polymarket: "Spoilers" of the Beast Games Champion
At the same time Kaptur was penalized for earning over $5,000 on Kalshi, MrBeast was advancing a much larger project. The reality show "Beast Games" Season 2, in collaboration with Amazon Prime Video, premiered on January 7, 2026, with 200 contestants vying for a record prize of $5.1 million. The finale aired on February 25, revealing the ultimate champion: Player 167, former U.S. Air Force pilot and University of Pennsylvania former wide receiver Tyler Lucas.
However, on Polymarket, this result seemed to have been "publicized" three weeks earlier.
PANews analyzed the odds changes for the Polymarket contract "Who will win Beast Games Season 2?" and discovered a highly unusual funding trajectory. During a phase when many contestants were still alive and the finale was far off, the Yes shares representing Player 167 faced continuous buying pressure that could not be explained by normal market logic.
Timeline analysis shows that the anomalous performance was clear and significant. From late January to early February 2026, before entering the second half of eliminations, Player 167’s winning probability began to diverge dramatically from the fundamentals. By February 4, three weeks before the final, Tyler Lucas’ championship probability had been pushed up to 84%. By February 18, just a week before the finale aired, the implicit probability of that contract was pinned at over 94% by funds.
In stark contrast, other top contenders who performed well in the show were almost completely "priced at zero." In a reality show with 200 contestants relying on physical and intellectual tests, it is difficult for rational funds to price a single contestant’s winning probability at over 90% during the mid-elimination phase without definitive insider information.
The Reddit community and the Polymarket comments section exploded with reactions. "The champion was basically spoiled by Polymarket," the titles of multiple threads bluntly pointed out this fact. Community members compared it to the earlier leak of season one champion Jeff Allen, noting that this time the data pattern was even more blatant.
The odds themselves are just a facade. PANews conducted a comprehensive collection and analysis of on-chain trading data for this market and found more direct evidence than the changes in odds.
The entire Beast Games Season 2 market recorded 111,000 transactions involving 2,640 unique addresses. Of these 2,640 addresses, one data point stands out: 795 addresses traded only the contract for Player 167 throughout the market's lifecycle. Choosing the ultimate champion among 25 contestants "coincidentally" indicates a concentration far beyond what can be explained by normal betting logic.
PANews further retrieved and cross-referenced the full platform trading history of all suspicious addresses, analyzing dimensions including the proportion of Beast Games trading, overall platform win rates, and cross-address correlation. Ultimately, 147 highly suspicious addresses were filtered out. Among them, 16 addresses exhibited textbook-level insider characteristics, having participated only in Beast Games-related markets without any other trading records.
Of these 16 addresses, the most suspicious one is named "0xA1F3Cf8Ba7410956a2955D5300A9be7Ff1dBc07E-1767992471439," having participated in only three Beast Games sub-markets, all profitable, with a 100% win rate, accruing a total profit of $3,237. There are several similar addresses; although individual profits may not be high, they exhibit highly analogous operations. This suggests that insider traders may intentionally reduce their visibility by diversifying their bets.
From a scale perspective, more attention should be paid to those hybrid traders who made a fortune on Beast Games but did not only trade MrBeast. Their trading behavior patterns further deepen suspicions. PANews identified multiple "address clusters" that were highly synchronized in time and behavior. On January 27, the largest trading day for the entire market (single-day trading volume reached $44,547), the top suspicious address completed all 12 transactions in 17 minutes, earning $11,830. Two anonymous addresses executed sell transactions in the same minute at 09:41 on January 30, each profiting $3,542, with amounts, timings, and actions completely mirroring each other.
So, who has the ability to place such certain bets mid-season? The sources of information point to very limited groups: Beast Industries' large post-production team, the 200 contestants participating in the recording and their close social circles, as well as the staff involved in scheduling and promotion (investigations have shown that several addresses focused on film-related contracts exhibit exceptionally high win rates). Kaptur's trades on Kalshi were only $4,000, earning more than $5,000. However, on Polymarket, the top suspected insider addresses tracked by PANews have already accumulated profits exceeding $100,000, which is likely just the tip of the iceberg.
A Feature as Well as an Unfair Game
Kalshi's precision in confiscating $5,397.58 in illegal gains is due to being a regulated centralized exchange where all traders' identity information, bank transactions, and IP trails are fully visible to the audit team. In contrast, on Polymarket, users only need to connect a decentralized wallet like MetaMask to trade; on-chain transactions are public and transparent, yet the true identities behind the addresses remain anonymous.
Deeper divisions exist in principle. Kalshi's enforcement head Robert DeNault explicitly defines information asymmetry as a violation that must be strictly punished. Meanwhile, Polymarket CEO Shayne Coplan has publicly stated a completely different position: Insider trading is a "feature rather than a flaw" of prediction markets.
The champion of Beast Games being "spoiled" to 94% on Polymarket three weeks beforehand may be a direct product of this systemic arbitrage. For ordinary players without insider advantages, participating in such event predictions essentially serves as fuel for the greedy.
From a broader perspective, the original intention of prediction markets was to turn collective wisdom into price signals. However, when it becomes a large-scale insider trading scheme, this unfair game may reflect not collective wisdom but the shadow of informational privilege.
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