Kalshi Inc., a New York-based betting exchange, has sparked public outrage after allowing users to bet on various aspects of the murder case surrounding Luigi Mangione, the accused killer of UnitedHealth executive Brian Thompson. This controversial move quickly attracted regulatory scrutiny and public condemnation, raising ethical concerns about the commodification of violent crimes.
Morbid Bets on a Tragic Murder Case
Kalshi, which gained recognition for offering legal event contracts in the U.S., allowed retail traders to place bets on the developments in the case of Mangione. The suspect was arrested on December 9 after allegedly killing Thompson in a violent attack on December 4. On December 11, Kalshi listed contracts enabling bettors to speculate on whether Mangione would be extradited to New York, whether he acted alone in the murder, and whether he would plead guilty or be convicted.
Just two days later, Kalshi halted the trading of these contracts, citing regulatory concerns. The decision followed a warning from the Commodity Futures Trading Commission (CFTC), which oversees the exchange. The CFTC has rules prohibiting event contracts that involve sensitive topics like crimes, terrorism, or war, especially when such bets are deemed contrary to public interest.
Regulatory Action Stirs Debate
The suspension of the contracts raised alarms about the role of betting platforms in the U.S. Kalshi, which operates under the CFTC’s oversight, quickly faced criticism for allowing betting on a high-profile murder case. “Betting on the fate of someone accused of a heinous crime is disturbing,” said Cantrell Dumas, director of derivatives policy at Better Markets, a financial watchdog organization. “It desensitizes the public to the gravity of such events.”
The CFTC’s intervention highlighted the challenges of regulating new, fast-moving betting markets. While Kalshi and similar platforms can quickly launch new contracts without prior approval, the CFTC has the authority to pause trades for review. In this case, Kalshi was forced to backtrack after only two days of allowing such bets.
The Risks of Event Contracts
Kalshi’s business model allows users to place bets on nearly any event, from elections to weather forecasts. This approach has earned the platform both praise and scrutiny. The ability to launch new contracts rapidly—without waiting for extended review periods like those imposed by the SEC on stock listings—has fueled Kalshi’s popularity. However, it has also raised concerns about the ethical implications of some contracts.
Dumas criticized this gap in regulation, pointing out that Kalshi can certify and launch contracts on controversial issues almost immediately. “There’s no cooling-off period like in other industries, where regulators can step in before something becomes widely available to the public,” he noted.
A Broader Industry Issue
Kalshi’s foray into sensitive topics is not unique. Other betting platforms, including crypto-based exchanges like Polymarket, continue to offer contracts on controversial subjects, including Mangione-related bets. Polymarket, however, faces its own legal challenges, including an ongoing investigation into its acceptance of illegal trades involving U.S. bettors.
The incident with Kalshi underscores a larger issue facing the betting industry—how to balance innovation with ethical responsibility. While platforms like Kalshi push the envelope by offering a wide range of contracts, regulators struggle to keep up with the rapid pace of change in this space.
Public Backlash Over Ethical Concerns
The decision to allow bets on Mangione’s case, even briefly, has fueled public outrage. Advocacy groups and individuals argue that such betting trivializes serious crimes and exploits human suffering. “It’s deeply troubling to see the public engaging in something so detached from the real-life consequences of the case,” said Dumas.
As the case continues to unfold, Mangione faces charges related to Thompson’s murder. The high-profile nature of the case and the media attention it has garnered have only heightened public scrutiny of platforms like Kalshi. Many are now questioning whether the monetization of tragic events crosses ethical lines.
