Goldman Sachs and Other Wall Street Banks Ban Employee Prediction‑Market Trading

Goldman Sachs has updated its personal‑trading policy to prohibit employees from trading on prediction‑market event contracts covering specific companies, election outcomes, financial‑market performance, cease‑fire dates, the price of bitcoin and merger‑approval processes. Violations could lead to termination, account closure and forfeiture or donation of any profit above $200.

Other major firms have taken similar steps. JPMorgan Chase previously warned staff to consider such trades carefully, while hedge funds Point72 Asset Management and Balyasny Asset Management have banned employee use of prediction markets altogether. Morgan Stanley is reported to have comparable policies, and Bank of America is developing new prohibitive measures.

Regulators and lawmakers are also acting. New York and Illinois have barred government employees from insider‑informed prediction‑market trading, and a U.S. House bill – the Stop Lawmakers from Predicting Act – seeks to forbid members of Congress and their families from such activity. The move follows a Justice Department and CFTC case in which a Google engineer earned $1.2 million on Polymarket using non‑public information.

Prediction‑market platforms themselves are expanding: Polymarket has applied to become a futures‑commission merchant to offer margin trading, and both Polymarket and rival Kalshi reported record trading volumes in June 2024.