Prediction markets, tokenised securities and digital assets are giving employees more ways to invest than ever, and many compliance frameworks are not keeping up. Although the venues are new, the conduct risks behind them are largely familiar, which leaves firms with uncomfortable gaps in oversight.
The issue was explored in a recent StarCompliance webinar, New Markets, Same Risk: Compliance Challenges in Digital and Prediction Markets, part of its 2026 Global Compliance Benchmark Study series.
The series draws on findings from Star’s first Benchmark Study, which pointed to rapid AI adoption, emerging market risks and mounting pressure to modernise compliance programmes.
Panellists included Ian McGinley, partner at Sidley Austin and former director of enforcement at the US Commodity Futures Trading Commission (CFTC), Kate Dellolio of a16z, who supports the firm’s crypto vertical, and Bryan Choe of RWA.XYZ, a data analytics platform focused on tokenised assets.
The first insight was that new markets do not mean new misconduct. Recent enforcement action has shown how employees may exploit sensitive or non-public information to trade event contracts, mirroring concerns firms already manage in traditional securities. The danger is that personal account dealing programmes built around securities and brokerage accounts may miss this activity entirely. Firms should therefore test whether existing controls target the behaviour they want to stop, whatever the asset or platform.
Second, policies are struggling to keep pace. Many codes of ethics and personal trading rules were drafted around concepts such as reportable securities and securities accounts, and emerging products often fall outside those definitions.
Instead of trying to predict every new instrument, firms can focus on the underlying activity and decide when disclosure, pre-clearance or restrictions should apply. This risk-led approach avoids rewriting frameworks each time a product appears.
Third, tokenisation is blurring traditional boundaries. Digital assets now extend well beyond Bitcoin and Ethereum, with conventional financial instruments increasingly represented on blockchain networks.
Compliance teams need to understand not only what staff are trading but where and how. Account disclosure, pre-clearance and surveillance may need to span both traditional and blockchain-based platforms, since the infrastructure can change while the compliance risk stays the same.
Finally, the panel argued that firms should build for the risk rather than the product. Writing rules for every scenario is unsustainable when platforms emerge so quickly. A more scalable model combines clear policies, employee education, suitable pre-clearance requirements and surveillance able to detect relevant activity across markets.
The core objectives remain unchanged: identify conflicts, protect sensitive information and oversee employee activity properly. The task now is ensuring controls designed for traditional markets are ready for what comes next.
Read the full StarCompliance post here.
Copyright © 2026 RegTech Analyst
Copyright © 2026 RegTech Analyst
