Goldman Sachs bans employees from participating in finance and political prediction markets

Goldman Sachs has updated its personal trading policy to prohibit employees from participating in prediction market contracts linked to financial, political, or regulatory events. The decision reflects growing concerns about conflicts of interest and the potential misuse of confidential information within one of the world's largest investment banks.

The restriction covers contracts tied to events such as central bank decisions, election outcomes, macroeconomic releases, and other developments capable of materially affecting financial markets. According to Reuters, sports and entertainment contracts remain permitted because they present a much lower compliance risk.

The policy comes as prediction markets continue to expand rapidly. Platforms such as Kalshi and Polymarket have seen significant growth in trading activity, attracting both retail users and professional traders. As the industry matures, major financial institutions are increasingly updating their compliance frameworks to address this emerging asset class.

Goldman Sachs is not alone. Other Wall Street firms—including JPMorgan Chase, Bank of America, Citigroup, and Morgan Stanley—have also introduced restrictions or specific guidance governing employee participation in prediction markets where material non-public information or conflicts of interest may arise.

According to Reuters, repeated violations of these internal policies may result in disciplinary action, including forfeiture of profits and, in some cases, termination of employment. The measures illustrate how rapidly growing prediction markets are becoming an increasingly important compliance issue across the global financial industry