BBB refers Kalshi to state regulators over influencer disclosure
In brief
- BBB's National Advertising Division referred Kalshi to state regulators after company declined voluntary inquiry
- NAD examined whether Kalshi influencers clearly disclosed paid relationships and complied with FTC guidelines
- Kalshi's marketing practices drew scrutiny from Media Matters over viral TikTok and Instagram campaigns
Referral and Regulatory Escalation
The BBB's National Advertising Division referred Kalshi to regulatory authorities after the company declined to participate in NAD's voluntary self-regulatory review. NAD said it will refer the matter to appropriate regulatory authorities, including relevant state Attorneys General, for possible enforcement action.
At issue for NAD was whether material connections between Kalshi and influencers or affiliates were clearly and conspicuously disclosed in social media advertising. The inquiry examined whether Kalshi's influencers and affiliates clearly disclosed paid relationships and whether the company took adequate steps to comply with FTC endorsement guidelines. NAD will notify the social media platforms where Kalshi's advertising appeared.
Marketing Scrutiny and Growth
Kalshi's advertising practices have also drawn scrutiny from Media Matters for America, a nonprofit media watchdog organization. The group highlighted the platform's viral marketing campaigns on TikTok and Instagram that promoted prediction trading as a side hustle to younger audiences.
Despite regulatory pressure, Kalshi is a leading centralized prediction market platform alongside decentralized rival Polymarket. The company secured a $1 billion funding round valuing it at $22 billion, and a Kalshi spokesperson told Bloomberg the company is on track for a $1.5 billion annualized revenue run rate. A May research report from Bernstein argued that the prediction market sector is entering an institutional era, suggesting the market's maturation may bring increased regulatory attention.
