Even social media influencers' editors can engage in insider trading, and a single fine from Kalshi reveals a gray area in the prediction market.

Written by: Frank, PANews

On February 25, 2026, the prediction market platform Kalshi issued a fine of $20,397.58 to a YouTube editor. This precise amount, down to the cent, marks the first publicly disclosed insider trading penalty in the history of the prediction market industry.

The fined individual is Artem Kaptur, the visual effects editor for the world’s largest influencer MrBeast. He invested about $4,000 in trading MrBeast-related YouTube event contracts on Kalshi and earned $5,397.58. However, this seemingly small profit triggered a major regulatory signal across the industry, prompting the CFTC (U.S. Commodity Futures Trading Commission) to release an official enforcement advisory on prediction markets.

Kalshi is a regulated platform with real-name KYC, so catching a trader using their real identity is not difficult. The real question is: what happens if someone with the same inside information turns to Polymarket, which does not require identity verification? PANews analysis found that in the Polymarket contract for season 2 of MrBeast’s reality show “Beast Games,” the final winner’s probability was pushed to 94% three weeks before the season ended, exhibiting textbook insider trading characteristics.

Starting from Kalshi’s penalty, combined with on-chain data anomalies on Polymarket, PANews will deeply analyze how, in the era of “anything can be bet on,” insider trading has transformed from Wall Street jargon into a gray area accessible even to assistant editors.

First Insider Trading Penalty in Prediction Markets

According to Kalshi’s disciplinary notice, Kaptur used his position at Beast Industries during August to September 2025 to trade event contracts related to the MrBeast channel.

Kalshi’s monitoring system detected extremely abnormal statistical features: Kaptur achieved an “almost perfect trading success rate” in low-odds markets. Meanwhile, because Kalshi’s trading data is fully public, multiple platform users also identified this anomaly and reported it proactively. Under dual triggers, Kalshi froze Kaptur’s account and launched an investigation. The final penalty was the confiscation of all illegal gains of $5,397.58, plus a $15,000 punitive fine, totaling $20,397.58, and a two-year platform ban.

On the same day, another more absurd case was disclosed. California Republican gubernatorial candidate Kyle Langford bet about $200 on his own election on Kalshi and then publicly flaunted the transaction screenshot on X. Kalshi froze his account that day and ultimately imposed a five-year ban and a $2,246.36 fine.

While these fines are not large, their signaling significance far exceeds the amounts. On the same day, the CFTC issued an official enforcement advisory citing Section 6©(1) of the Commodity Exchange Act, indicating both cases could constitute federal violations. CFTC Chair 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 regulator against insider trading in prediction markets.

Beast Industries issued a statement affirming a “zero tolerance” stance toward insider trading by employees and has initiated an independent internal investigation. However, the company also suggested that Kalshi should “be more open” in communicating investigation results in the future.

But all these efforts rest on a premise: Kalshi is a centralized platform with verified identities, bank statements, and IP addresses fully known. Catching a trader using their real identity does not reveal much. The real question is: what if someone with the same inside information chooses a platform like Polymarket, which requires no identity verification and settles with anonymous wallets and USDC?

94% on Polymarket: “Spoilers” for Beast Games Champion on-chain

At the same time Kaptur was earning over $5,000 on Kalshi and getting penalized, MrBeast was pushing forward with a much larger project. The second season of the reality show “Beast Games,” in partnership with Amazon Prime Video, premiered on January 7, 2026, featuring 200 contestants competing for a record-breaking $5.1 million prize. The season finale aired on February 25, revealing the champion: Player 167, a former U.S. Air Force pilot and former Penn State football player Tyler Lucas.

However, on Polymarket, this result appears to have been “publicly leaked” three weeks earlier.

PANews analyzed the odds changes on the “Who will win Beast Games Season 2?” contract on Polymarket and found an extremely abnormal money flow. During the phase when many contestants were still in the competition and the finals were far off, the Yes shares for Player 167 experienced persistent buying pressure that defied normal market logic.

The timeline shows a clear and significant anomaly. From late January to early February 2026, when the show had not yet entered the knockout stage, the probability of Player 167 winning began to diverge sharply from fundamentals. By February 4, three weeks before the finale, Tyler Lucas’s winning probability had surged to 84%. By February 18, just one week before the finale, the implied probability was pinned above 94%.

In stark contrast, other top-performing contestants in the show were almost “priced at zero.” In a 200-person competition relying on physical and mental tests, without insider information, rational funds would not price a single contestant’s winning probability above 90% midway through the contest.

Reddit communities and Polymarket comment sections exploded with discussions. Headlines like “The champion was basically spoiled on Polymarket” pointed directly to this. Community members drew parallels with the early leak of season 1 winner Jeff Allen, but this time the data pattern was even more blatant.

Odds are just surface-level indicators. PANews conducted comprehensive on-chain transaction analysis of this market, uncovering more direct evidence than odds fluctuations.

The entire Beast Games season 2 market recorded 111,000 transactions involving 2,640 unique addresses. Among these, one data point was particularly striking: 795 addresses traded only the contract for Player 167 throughout the entire market lifecycle. Out of 25 contestants, only the eventual champion was “coincidentally” targeted, a concentration far beyond normal betting logic.

Further cross-referencing all suspicious addresses’ transaction histories across the platform, including betting proportions, overall win rates, and address linkages, PANews identified 147 highly suspicious addresses. Among them, 16 exhibited textbook insider trading features—they only participated in Beast Games markets and had no other trading records on Polymarket.

These 16 addresses, especially the most suspicious one “0xA1F3Cf8Ba7410956a2955D5300A9be7Ff1dBc07E-1767992471439,” only engaged in three Beast Games submarkets, all profitable with a 100% win rate, totaling $3,237 in gains. Multiple similar addresses showed high profits with similar operational patterns, suggesting deliberate dispersal of bets to avoid detection.

More concerning are the mixed traders who profited heavily on Beast Games but did not solely trade MrBeast-related markets. Their trading behaviors further deepen suspicion. PANews identified multiple “address clusters” with highly synchronized timing and actions. On January 27, the largest trading day with a total of $44,547 in volume, the top suspect address completed all 12 trades within 17 minutes, earning $11,830. Two anonymous addresses executed sell trades within the same minute on January 30 at 09:41, each earning $3,542, with identical amounts, timing, and behavior.

Who could confidently place such bets mid-season? The likely sources are very limited: Beast Industries’ extensive post-production team, the 200 contestants and their close social circles, and staff involved in scheduling and promotion (investigations found multiple addresses focusing on film and TV contracts with suspiciously high win rates). Kaptur’s $4,000 trading on Kalshi, earning over $5,000, contrasts sharply with the over $100,000 in profits tracked on Polymarket from suspected insider addresses—likely just the tip of the iceberg.

Features and Unfairness of the Game

Kalshi’s ability to precisely confiscate $5,397.58 stems from its status as a regulated centralized exchange, where all user identities, bank transactions, and IPs are fully visible to auditors. On Polymarket, users only need to connect MetaMask or similar wallets to trade, with on-chain transparency, but the real identities behind addresses remain anonymous.

Deeper differences lie in philosophy. Kalshi’s enforcement chief Robert DeNault explicitly defines information asymmetry as a violation that must be strictly punished. In contrast, Polymarket CEO Shayne Coplan has publicly expressed a very different stance: insider trading is a “feature, not a flaw” of prediction markets.

The early “spoiling” of the Beast Games champion on Polymarket—reaching 94% three weeks ahead—may be a direct result of such systemic arbitrage. For ordinary players with no inside edge, participating in such predictions essentially makes them fuel for insiders, akin to being mere fodder.

From a broader perspective, prediction markets aim to harness collective intelligence into price signals. But when they turn into large-scale front-running or “mouse trading,” the game reveals that what emerges is not wisdom of the crowd but shadowy information privileges.