Betting on news raises ethics questions for journalists

Prediction market exchanges create an environment where almost any information can be monetized: How did BTS’ new song perform this week? How hot will it be in Los Angeles? Will Donald Trump be impeached? Users can place bets on all of these, and on some platforms, More horrific and violent results in the real world.

The rapid rise and expansion of Polymarket and Kalshi have put newsrooms in a strange position. Prediction market evangelists often claim that their odds are more trustworthy and accurate than polls and traditional media—effectively positioning the industry as an alternative to news. At the same time, from various news organizations fox news arrive Associated Press Deals are being struck with prediction market exchanges, Polymarket and Kalshi are trying Align yourself with independent journalists and Vice stacker Via paid placement transactions.

As prediction markets allow users to monetize news, journalists are caught in the crosshairs: what they report (and the information included in the report) suddenly has a dollar amount attached to it. It also means that the information they encounter on the job can be extremely valuable. Earlier this week, ProPublica announced it was updating its ethics code to explicitly mention restrictions on how employees can use prediction markets. ProPublica’s ethics code already places restrictions on how employees can invest in outside companies they cover. but policy It now states that “no employee should place bets on the outcome of a news event in prediction markets—regardless of whether they were involved in reporting on the event.”

Diego Sorbara, ProPublica’s assistant managing editor, said the outlet began discussing the issue after reports emerged that some Polymarket users were making hundreds of thousands of dollars. Betting on Iran’s Military Action. (One more question: times of israel Journalists threatened by punters Ask him to update his story to be consistent with their bets. )

“If you’re covering the Iran war, you shouldn’t be investing money in it so you can get rich off the news,” Sorbara said. “Just like you wouldn’t buy a stock, I think we see it as almost a natural progression.” Sorbara said the policy applies not just to editorial staff like reporters and editors, but also to people working on the business side because everyone knows the story that’s going on.

ProPublica’s policies allow some gambling: office Oscar voting, for example, or legal sports betting. Sorbara’s reasoning is that because the outlet doesn’t really cover the results of sporting events, sports betting doesn’t get much attention. The exception is if a reporter is covering a story about the NFL or another sports league, in which case tighter restrictions may apply. Created the story of 2021 For example, rules regarding tax avoidance by NBA owners would prohibit betting on basketball games.

Much of Kalsi’s trading volume is related to sports, but prediction markets complicate what is and is not a “news event.” I asked Sorbara if ProPublica employees would be allowed to place bets on peripheral markets related to the Super Bowl — who would be in the crowd, or who would perform.

“‘Whether someone will perform at a certain event?’ can be calculated through thousands of different calculations. It could be an ideological issue: ‘I won’t perform at this event because this organization supports X,’ or ‘This alliance has taken a position on Y in the past,'” Sorbara said. “All of a sudden, it’s like a news story to me. If anyone (staff) asked me, I would tell them not to (bet on) that.”

The concern isn’t just about avoiding conflicts of interest—journalists reporting news can change the odds in prediction markets, and in some cases, the reporting itself becomes an opportunity to place bets. At Polymarket, over $55M in volume involves question of who will be named time2025 Person of the Year, chosen by the magazine’s editors.

“Time’s existing policy prohibits employees and their family members from engaging in prediction markets or similar activities that speculate on non-public information obtained while they work at Time,” spokesperson Kristin Matzen said. edge in an email. “This policy also restricts all employees and their family members from participating in any prediction market activity based on the TIME announcement.”

Some news outlets view their existing rules on conflicts of interest as covering prediction market activities. edgeIts ethics statement states: “We do not allow journalists to report on individuals or companies with whom they have personal conflicts.”

“My current understanding is that current ethics policies prevent conflicts of interest, including journalistic gambling,” edge Editor-in-Chief Nilay Patel said. “But if we need to develop stricter policies specifically for prediction markets, we will watch closely and take action without hesitation.”

Likewise, Charlie Stadtlander, executive director of media relations and communications new york timespoint it out to me its existing ethics policy The bill prohibits employees from making “investments of any kind” in “companies, businesses or industries that appear or may appear within the reporting scope” for which they work, including derivatives, futures, short selling and speculative debt (Kalshi and Polymarket’s smaller U.S. platforms are regulated by the Commodity Futures Trading Commission).

Insider trading is illegal, but what happens in prediction markets is almost taken for granted — including Sponsored Influencer Content Hype Platform. The argument that prediction markets can predict what will happen in the future even before an event occurs depends in part on whether there are insiders on the platform trading on information that has not yet been made public. Journalists often have access to non-public information—upcoming embargoed news, non-public details from sources, or news that has not yet been released. If you throw ethics out the window and don’t worry about losing your job, journalists make perfect insiders. Polymarket CEO Shayne Coplan said it was “cool” that his company had created an environment where insiders could leak information they had. The problem is, insider trading is considered illegal, and true insider traders—such as journalists, or Pennsylvania poll workers ——Trading in the relevant prediction market is theoretically not allowed. Without insiders, what competitive advantage does prediction market odds have?

While staff at media outlets are prohibited from trading in prediction markets, newsroom after newsroom has announced licensing or advertising deals with these same platforms (not to mention a partnership between MLB and Polymarket, or FIFA deal with a little-known platform). Do these media outlets view their responsibilities differently?

CNN, which has a partnership with Kalshey, prohibits its employees from betting on prediction markets and disclosing stories about the industry, spokesperson Anna Jager said in an email.

“Prediction markets only provide one source of data that journalists can use when telling a story,” Jaeger said. “It is used as a supplement to other reporting and data sources, such as opinion polls. It is not a substitute for other sources and does not have an impact on editorial independence.”

Dow Jones, Publisher wall street journalformed a data partnership with Polymarket in January. spokesperson Lauren McCabe told edge The company has issued guidance prohibiting all employees from trading on confidential work information and “must avoid any prediction market activity that may create a conflict of interest with their work,” according to an email. News employees and their family members are also prohibited from betting on prediction markets related to their coverage areas.

Through deals with traditional news media and prominent placements at events ranging from sports broadcasts to award shows, prediction markets are working to legitimize themselves and gain institutional adoption. Sorbara said he found media deals “bizarre” even though they resembled behind-the-scenes data licensing agreements.

“The optics are not particularly good to me,” he said. “I think as journalists we have a responsibility to be as impartial as possible and even avoid situations that are questionable because we’re supposed to be the ones telling the truth. If people can’t trust us, then there’s not much we can do.”