Six months ago, Goldman Sachs CEO David Solomon called prediction markets “super interesting” and said the firm had been talking to platform leaders about potential involvement. Now Goldman has told its staff they cannot participate in those same markets.

The bank updated its internal personal trading policy in July 2026, prohibiting employees from placing contracts on prediction markets tied to finance, politics, or economics. The carve-outs are narrow: sports and entertainment betting remain permitted. Everything else, including contracts tied to specific companies, Goldman Sachs among them, is off the table. Violations are not treated as minor infractions either. Repeated offenses can result in termination.

What spooked Wall Street’s most famous bank

The policy shift did not happen in a vacuum. In May 2026, the Commodity Futures Trading Commission and the Department of Justice brought charges against a Google employee accused of using nonpublic information to profit roughly $1.2 million on Polymarket contracts.

Goldman is not alone in rethinking its posture here. Morgan Stanley has folded prediction market guidelines into its broader code of conduct. JPMorgan and Bank of America are both reassessing their own policies.

The irony of Solomon’s January enthusiasm

Solomon’s January 2026 comments were not vague corporate optimism. He described prediction markets as genuinely compelling and confirmed the firm had held active conversations with platform operators about what Goldman’s participation might look like.

The July ban does not necessarily mean Goldman has abandoned all interest in prediction markets as a business opportunity. The policy governs employee personal trading, not the firm’s own potential institutional activities. It is worth noting that the CFTC and DOJ case involved Polymarket specifically, a platform that operates with crypto infrastructure and attracted significant retail and institutional volume around the 2024 US presidential election. Kalshi, which operates under direct CFTC oversight as a designated contract market, occupies a somewhat different regulatory position. The Goldman ban does not appear to distinguish between them.