California prohibits state officials from profiting in prediction markets using insider information.

Gate News reports that on March 28, California Governor Newsom signed an order on the 27th to prohibit state-appointed officials from profiting from insider information in prediction markets. The California Governor’s Office stated in a release that some officials who clearly have access to sensitive information from the federal government have “extremely precise timing” in their bets within prediction markets, with some turning public service into a means of “quick wealth.” The statement pointed out that four cases of prediction trading showed that individuals lacking insider information are highly unlikely to make related trades. Profits from these predictions ranged from tens of thousands to millions of dollars, involving multiple military actions by the United States concerning Venezuela and Iran, with some predictions made just days before the actions when accounts were opened or bets placed just hours prior to the events. Among them, six suspected insiders bet on U.S. military strikes against Iran, collectively profiting $1.2 million, and they had opened their prediction market accounts just days before the conflicts occurred.