CONNECT WITH US
Fintech

Fintech

Prediction markets expose gaps in employee compliance

Fintech Global logo

Published on

Add as a preferred source on Google
Prediction markets expose gaps in employee compliance

Prediction markets, tokenised securities and digital assets are opening new ways for employees to invest, and compliance teams risk falling behind. The products may be new, but the conduct risks they create are ones firms already know well.

This was the central theme of a recent StarCompliance webinar, New Markets, Same Risk: Compliance Challenges in Digital and Prediction Markets. The session forms part of the company’s 2026 Global Compliance Benchmark Study webinar series, which builds on findings from its first Benchmark Study.

That research pointed to rapid AI adoption, emerging market risks and mounting pressure on firms to modernise their compliance programmes.

The panel featured Sidley Austin partner Ian McGinley, formerly director of enforcement at the US Commodity Futures Trading Commission (CFTC), Kate Dellolio of a16z, who supports the firm’s crypto vertical, and Bryan Choe of RWA.XYZ, a data analytics platform specialising in tokenised assets.

The first concern raised was that prediction markets bring familiar dangers in an unfamiliar wrapper. Recent enforcement action has shown how employees could use sensitive or non-public information to trade event contracts. However, personal account dealing programmes built around securities and brokerage accounts may not capture this activity at all, leaving it outside existing controls. Firms should therefore ask whether their controls target the behaviour they want to stop, whatever the asset or platform.

The second issue was policy drift. Many codes of ethics and personal trading rules were drafted around concepts such as reportable securities and securities accounts. Prediction markets and digital assets do not always fit those definitions.


Source link
Related Topics:Fintech

Disclaimer

We strive to uphold the highest ethical standards in all of our reporting and coverage. We TheMorningPulse.fyi want to be transparent with our readers about any potential conflicts of interest that may arise in our work. It's possible that some of the investors we feature may have connections to other businesses, including competitors or companies we write about. However, we want to assure our readers that this will not have any impact on the integrity or impartiality of our reporting. We are committed to delivering accurate, unbiased news and information to our audience, and we will continue to uphold our ethics and principles in all of our work. Thank you for your trust and support.