BBB Advertising Division Refers Kalshi to Regulators After Company Declines Inquiry

The Better Business Bureau’s (BBB) National Advertising Division (NAD) said it is referring prediction market platform Kalshi to regulatory authorities after the company declined to participate in an inquiry into its social media advertising practices. According to Cointelegraph, NAD said in a statement published Monday that it will refer the matter to appropriate regulators, including relevant state Attorneys General, for possible enforcement action. The review examined whether Kalshi’s influencers and affiliates clearly disclosed paid relationships in social media promotions and whether the company took adequate steps to comply with Federal Trade Commission endorsement guidelines. NAD said it will also notify the social media platforms where the advertising appeared. The BBB said the central issue was whether material connections between Kalshi and influencers or affiliates were clearly and conspicuously disclosed in social media advertising, and added that Kalshi declined to participate in NAD’s voluntary self-regulatory process.

Kalshi’s marketing has also drawn attention from Media Matters for America, a nonprofit media watchdog organization, which highlighted viral campaigns on TikTok and Instagram that promoted prediction trading as a “side hustle.” The platform has benefited from social media promotion as it expands event-based trading activity. A Kalshi spokesperson told Bloomberg that the company is on track for a $1.5 billion annualized revenue run rate, and said that momentum helped secure a $1 billion funding round valuing the company at $22 billion. Kalshi operates as a centralized prediction market platform alongside decentralized rival Polymarket. The broader prediction market sector has continued to grow despite an ongoing jurisdictional dispute between state regulators and the Commodity Futures Trading Commission over event contracts, as well as allegations of insider trading. A May research report from Bernstein said the sector is entering an “institutional” era, citing a block trade executed on Kalshi as evidence of improving liquidity and more efficient price discovery, and adding that block trading and bespoke contracts could expand participation from institutional investors seeking targeted exposure to event risks.