The Federal Trade Commission (FTC) will reportedly exclude prediction markets Kalshi and Polymarket from its probe into deceptive practices in the online sports gambling industry. Instead, the investigation will focus on sportsbooks such as DraftKings and FanDuel, likely examining misleading advertisements, as well as the rates of suicides, hospitalizations, and bankruptcies caused by the industry.

Kalshi and Polymarket, which offer crypto perpetuals and utilize blockchain technology respectively, are already under an insider trading probe by Republican House Oversight Committee member James Comer. The state of New York has also sued both firms this year, accusing them of running illegal gambling operations that encourage problem gambling among individuals under 21. Both companies deny offering gambling services and seek federal regulation under the Commodity Futures Trading Commission (CFTC).

Donald Trump Jr. holds advisory roles in both firms, with $300,000 worth of Kalshi shares and his investment firm 1789 Capital having invested $500 million in Polymarket.