The House Oversight Committee launched an insider trading investigation into Kalshi and Polymarket, which also impacted Robinhood and Coinbase. The SEC approved Nasdaq's listing of cash-settled Bitcoin index options on the Philadelphia Stock Exchange.

According to BBX data, the cryptocurrency prediction market is facing increasing regulatory pressure, leading to a simultaneous expansion of institutional-grade cryptocurrency derivatives product lines. On May 22, James Comer, Chairman of the House Oversight and Government Reform Committee, issued investigative letters to Kalshi and Polymarket, initiating a congressional investigation into insider trading on prediction market platforms. The investigation focuses on two suspicious bets made hours before the public disclosure of events: betting on the arrest of Venezuelan President Maduro and the outcome of the Iranian conflict. The Wisconsin Attorney General recently named Robinhood, Kalshi, Polymarket, and Crypto.com as defendants, accusing them of providing unlicensed sports betting services in Wisconsin. This is the latest development in the escalation of prediction markets to congressional scrutiny after facing legal challenges in 13 states. Both platforms have stated their willingness to cooperate with the investigation, claiming they have robust anti-insider trading mechanisms. On May 23, the U.S. Securities and Exchange Commission approved a proposal submitted by Nasdaq, allowing it to list cash-settled Bitcoin index options on the Philadelphia Stock Exchange. These options do not involve physical delivery of Bitcoin and provide institutional investors with a standardized tool to hedge or invest in Bitcoin price volatility. This fills a market gap for such derivatives on regulated exchanges in the United States. The timing of the approval coincides with significant Bitcoin volatility during the week, reflecting the accelerated release of market demand for volatility management tools.