A New York-based betting platform, Kalshi, has come under fire after allowing users to wager on the legal fate of Luigi Mangione, the alleged assassin of UnitedHealth CEO Brian Thompson.
The controversial trades, which included bets on Mangione’s extradition, plea, and whether he acted alone, were abruptly shut down by regulators on December 13, sparking debate over the ethics and legality of such speculative markets, per the New York Post.
Kalshi gained notoriety as the first platform to offer legal election betting in the U.S. in over a century. However, its recent event contracts surrounding Mangione’s case raised concerns about exploiting criminal cases for financial gain.
Mangione, arrested at a Pennsylvania McDonald’s on December 9, faces charges related to the December 4 killing of Thompson, and his case has drawn widespread media attention.
The Commodity Futures Trading Commission (CFTC) oversees Kalshi and prohibits event contracts tied to crimes, terrorism, and war if deemed against public interest. Kalshi halted trading after receiving notice from the CFTC, though critics argue the platform should never have permitted the contracts in the first place. Financial watchdog groups expressed outrage, labeling the practice a troubling desensitization to human tragedy.
Cantrell Dumas, director of derivatives policy at Better Markets, criticized Kalshi, stating, “People are betting on whether this person is allegedly responsible for the assassination of another human being, and here we are desensitized to this and betting on whether he’ll enter a guilty plea.”
Despite the halt, Mangione-related contracts reportedly remain active on other platforms, such as Polymarket, which specializes in crypto-based betting markets. Polymarket claims it has barred U.S. users since 2022, but the case highlights ongoing regulatory challenges with offshore platforms skirting U.S. laws.
Adding to Kalshi’s troubles, its founder faced an FBI raid concerning alleged violations of accepting trades from U.S. bettors in the 2024 presidential election. The investigation raises questions about oversight in the rapidly evolving world of prediction markets and the effectiveness of regulatory bodies like the CFTC in policing them.
Kalshi’s ability to launch contracts without prior approval has drawn further scrutiny. Unlike the Securities and Exchange Commission (SEC), which enforces a 10-day review period, the CFTC allows contracts to go live immediately, pending review. Critics argue this loophole enables speculative markets to exploit current events before proper oversight can intervene.
While proponents argue such markets can provide insight into public sentiment and outcomes, opponents warn of the dangers of commodifying crime and tragedy.