No worse than existing financial markets, and we already deal with those.

The big difference here is that if you buy short-dated out-of-the-money options and make it big, the SEC comes knocking on your door and reads your text messages to find out what you knew and when.

It's both easy to track down stock traders due to KYC, and easy to prosecute due to laws.

Polymarket and friends make it both much harder to find the trader, and also it's less clear if there's a legal theory that lets you prosecute someone dealing in these new markets.

Sure, congress and the president can insider trade a bit here and there, but the everyday joe is rightfully afraid to.