Outraged by Trump’s laissez-faire approach to ethical wild west, governors of New York and Illinois jointly signed executive orders banning state employees from using insider information to bet on prediction markets.

New York Governor Kathy Hochul signed EO 60 on April 23, following in the footsteps of Illinois Governor JB Pritzker just one week later, to explicitly prohibit state government employees from using confidential information obtained through their official duties to profit from bets on prediction markets. Hochul stated bluntly that getting rich on inside information is corruption; the actions of both states are seen as a direct pushback against the federal government’s tolerance of an "ethical Wild West." (Previous coverage: CFTC Chair Selig took a hardline stance: Prediction markets are "ours to regulate," jurisdiction belongs to the federal government, and lawsuits have been filed against three states.) (Background: Prediction market Kalshi accused of "unlicensed gambling" and formally sued by Nevada; Trump administration takes a side.) Within one week, executive orders from two Democratic governors have been implemented—this is no coincidence, but a calculated counterattack at the state level. New York Governor Hochul announced the signing of EO 60 in an official press release on April 23, directly citing the risks of insider trading in prediction markets and calling the move "nation-leading legislation." Illinois Governor Pritzker acted two days earlier, signing EO 2026-04 on April 21 with equally strong language. The core of both orders is consistent: state government employees are prohibited from using confidential information accessed through their positions to place bets on any prediction market or event contract platform, nor may they assist others in profiting in the same manner. Violators face the dual consequences of termination and enforcement action. Hochul did not mince words in her statement. She declared, "Getting rich by betting on inside information is corruption, plain and simple." She further pointed the finger at the Trump administration, criticizing federal authorities for allowing prediction markets to become an "ethical Wild West" without establishing any "meaningful ethical standards." Pritzker’s rationale focused more on the institutional aspect: "Illinois is strengthening its commitment to a transparent and ethical government, preventing insider trading from infiltrating the public sector as online prediction markets and event betting grow rapidly." Hochul’s EO 60 specifically cited two incidents that drew public attention. The first was a suspicious bet on Polymarket: hours before news broke that Venezuelan leader Maduro had been captured by the U.S. military, a user placed a large bet on "Yes" at extremely low odds, ultimately profiting approximately $400,000. The second was an anomalous trading pattern observed in event contracts related to Iran's Supreme Leader Khamenei this past February. While these two cases do not definitively prove insider trading, they were sufficient for New York State to include them in the legislative findings of the executive order. This wave of state-level regulation is not an isolated phenomenon—California became the first to ban state-appointed officials from participating in prediction markets last month; the New York State Gaming Commission issued a cease-and-desist order to Kalshi as early as October 2025, citing the operation of sports betting services without a license; meanwhile, the legal battle between Kalshi and the Nevada Gaming Control Board continues, with a lower court having temporarily prohibited its operations in the state. On the federal level, although CFTC Chair Selig insists that the federal government holds exclusive jurisdiction over prediction markets, and the Trump administration has sided with industry players in multiple lawsuits, states clearly have no intention of waiting for federal action. The scale of prediction markets itself continues to escalate regulatory tension. Data from Token Terminal shows that global prediction market volume reached $2.36 billion in March, breaking historical records for the seventh consecutive month; the massive capital flow makes the question of "who is in charge" increasingly urgent. Coinbase Chief Legal Officer Paul Grewal’s observation points to the endgame of this multi-party struggle: as the regulatory stances between federal and state levels continue to diverge, this case is highly likely to reach the U.S. Supreme Court, where the court will determine the regulatory jurisdiction of prediction markets and the standards for defining insider trading. Currently, the executive orders in New York and Illinois are in immediate effect; for the entire prediction market industry, this week’s joint action by the two states may be just the prologue to a much longer legal battle.