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Studios and production companies in Hollywood have begun issuing guidelines that bar employees from betting on prediction markets, The Hollywood Reporter (THR) reported in an exclusive.
Prediction markets are platforms such as Kalshi and Polymarket where users wager on the outcome of future events.
According to the report, the warnings prohibit staff from betting on news such as studio earnings, casting decisions and release dates. Staff are also forbidden from passing information to friends or family so they can place bets. At least one company has set up a hotline where employees can anonymously report colleagues suspected of betting.
The guidelines expand long-standing rules that bar employees from insider trading in the stock market. THR said many instances of prediction market profiteering based on confidential corporate information may already violate federal law, but markets now cover topics from the next Wonder Woman casting to “Dancing With the Stars” eliminations, which widens the chances to profit from inside knowledge.
Joshua Mitts, a Columbia University law professor who has studied prediction market betting, said the number of employers that must consider insider trading rules has grown sharply, and that educating staff on what is allowed is a compliance challenge separate from any criminal case.
THR’s parent company PMC, which also owns Dick Clark Productions, Variety and Deadline, updated its employee handbook in recent weeks to ban betting on award nominations, casting decisions, production timelines and release dates.
In February, U.S. based online financial exchange and prediction market platform Kalshi disclosed that a video editor at MrBeast’s company made $5,000 by using confidential information to bet on the YouTuber’s content. The employee was fired and fined $20,000. In April, a Puck column reported that someone who worked on a CBS competition show made money through prediction markets.
A television network source told THR that insider bets remain widespread despite company policies. Markets exist on what guests will say on the “Tonight Show,” “Saturday Night Live” and other talk shows, many of which are pre-taped or have dress rehearsals. Some audiences include members of the public who are not bound by any rules.
BetOnline temporarily removed its market on who will be cast as the next James Bond this week, after final auditions were expected to have taken place. A company representative said “sharp money” moved Callum Turner ahead of longtime favorite Jack Lowden, raising internal concern that a leak could be behind the bets.
Mitts said studios will struggle to stop employees from betting because bets are hard to link to individuals, particularly on blockchain-based platforms where users can hide their identity behind layers of intermediaries.
In February, six newly created Polymarket wallets earned $1.2 million by accurately betting on U.S.-Israeli strikes on Iran, according to THR. No one has been identified. A March study by Mitts and Moran Ofir of the University of Haifa estimated $143 million in anomalous profit on Polymarket over two years.
Over the summer, the Commodity Futures Trading Commission (CFTC), which regulates prediction markets in the U.S., asked the industry to comment on what should be legal to trade. The agency said betting on award shows such as the Oscars and Emmys should be allowed because winners are chosen through evaluative judgments, making them contests rather than gaming.
The CFTC was less certain about game shows, reality competitions and pageants, asking whether they should count as gaming. Some commenters complained about bets on the last season of “Survivor,” saying the winner appeared to have been identified early through aggressive wagering.
Under the Onion Futures Act of 1958, Congress explicitly outlawed only two types of prediction market bets: onion futures and motion picture box office receipts. Offering bets on a film’s box office revenue is therefore illegal.
Mitts said entertainment markets have “very little social utility” compared with uses such as hedging against policy changes, and could be prime candidates for regulatory scrutiny given the high potential for insider trading.
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