House Oversight Committee Chairman James Comer expanded his prediction-market insider-trading inquiry on Sept. 29, sending document-request letters to Hyperliquid Labs, Crypto.com and Aristotle Exchange, the owner of PredictIt, according to CNBC, which first obtained the correspondence.

The letters ask each company for documents and communications describing its know-your-customer policies and its procedures to detect, investigate and report suspicious trading, CNBC reported. The requests place trader identification and market surveillance at the center of the broadened inquiry.

Why is Hyperliquid's leverage in scope?

For Hyperliquid, Comer's concerns extend beyond event contracts. According to excerpts published by CNBC, his letter to CEO Jeff Yan cited reports of a "substantial leveraged short position" opened within minutes of a presidential announcement about U.S. tariff policy in October 2025. Comer questioned whether the platform can identify the trader and refer the matter to U.S. law enforcement.

Those concerns remain allegations under investigation, not an established finding of insider trading. Spokespeople for Hyperliquid, Crypto.com and Aristotle Exchange had not immediately responded to CNBC's requests for comment on Sept. 29.

What products does the letter touch?

Hyperliquid's onboarding guide describes access through a crypto wallet or an email login. Its perpetual contracts allow users to take leveraged long or short positions on a token's price using collateral, rather than buying the token itself.

Those leveraged products differ structurally from Hyperliquid's HIP-4 outcome contracts. According to the protocol's documentation, HIP-4 outcomes are fully collateralized, settle within a fixed range and involve neither leverage nor liquidations. The first outcome market was a recurring binary contract settling daily against Bitcoin's price.

HIP-4 outcome trading went live in May, after the October 2025 trade cited in CNBC's account of Comer's letter — meaning the cited activity occurred on perpetual markets, not the prediction products that triggered the original inquiry.

How did the probe begin?

Comer opened the original inquiry on May 22, requesting information from Kalshi and Polymarket about identity verification, geographic restrictions and suspicious-trading monitoring. A committee spokesperson told CNBC those investigations remain ongoing and have produced nearly 1,000 documents and five briefings from the two companies.

The original May 22 letter to Polymarket sought more than account and trading records. It also requested documents on the financial impact of identity-verification and geographic-access policies, including "tradeoffs between compliance costs and platform growth."

That phrasing opens a second line of inquiry distinct from spotting suspicious trades: how a venue designs access to its markets. The letter asks whether international accounts face the same identity checks as U.S. accounts, including any exemptions or reduced-scrutiny pathways, and then follows the process through trading alerts and referrals to authorities.

The distinction matters. Examining a trader's activity differs from examining a platform's decisions. Internal discussions about growth and compliance could explain why access rules were chosen; flagged-account and referral records could show how monitoring translated into action. These are questions the committee wants answered — not findings that Polymarket's controls failed or that commercial considerations caused a violation.

With document demands now covering five platforms across both crypto-native and traditional prediction markets, the committee's next visible milestone will be the companies' production of KYC and surveillance records — and whether Hyperliquid can satisfy congressional requests for trader identification on a platform designed around wallet-based access.