Prediction market giant Kalshi could face federal charges over its handling of regulatory notifications for new betting contracts, according to a report.

The Commodity Futures Trading Commission is probing whether Kalshi properly notified the agency about dozens of products still in development, Politico reported Tuesday, citing a person with direct knowledge of the matter.

Kalshi acknowledged the regulatory scrutiny but downplayed the alleged violations.

Company spokesperson Elisabeth Diana told The Post that the warning “is about a procedural error involving the submission of a handful of contracts, many of which weren’t live.”

“We are already addressing the issue,” she added.

The months-long investigation is said to focus in part on a regulatory process known as self-certification that allows federally regulated exchanges to introduce new financial products without advance approval from the CFTC.

Under the system, trading can begin as soon as the next day after an exchange certifies to the CFTC that its new contracts meet federal requirements, including standards intended to prevent market manipulation.

The process has drawn criticism as prediction market operators expand their offerings to include wagers on sports, elections and government policy decisions.

The CFTC warned prediction market operators in July against making sweeping claims about the products they certify for trading.

The certification process has also drawn criticism from Wall Street over concerns that some prediction market contracts could be vulnerable to manipulation.

CME Group CEO Terry Duffy earlier this year raised concerns that some wagers were vulnerable to manipulation and should not have been permitted to begin trading, according to Politico.

The potential charges against Kalshi come despite a regulatory climate that has largely favored prediction markets under President Trump.

Under Chairman Michael Selig, the CFTC has backed prediction market operators in legal battles with state officials who accuse the companies of violating gambling laws, according to Politico.

Kalshi and rival Polymarket have reached valuations of $40 billion and $21 billion, respectively.

Democrats, fresh off their midterm election victories, are preparing to step up oversight of prediction markets when the next Congress convenes, Politico reported.

Kalshi isn’t the only major operator facing scrutiny from the CFTC.

Polymarket is the subject of a separate, sweeping investigation into whether it violated a 2022 regulatory settlement requiring the company to restrict American traders from its offshore platform.

The CFTC is examining whether Polymarket took adequate steps to keep US users off the site in the years following the agreement, Reuters reported last month, citing two people familiar with the matter.

That portion of the investigation concerns Polymarket’s historical safeguards, including its methods for determining customers’ locations and its advertising activities in the US.

The agency is separately examining customer onboarding procedures and protections at Polymarket’s newer, federally regulated US operation, according to Reuters.

Polymarket agreed to restrict US trading on its offshore platform in January 2022 after the CFTC accused it of illegally operating an unregistered derivatives exchange. The company was fined $1.4 million as part of the settlement.

Questions about the effectiveness of those restrictions resurfaced during the 2024 presidential election, prompting investigations by the CFTC and Justice Department.

The FBI searched Polymarket CEO Shayne Coplan’s Manhattan home in November 2024 as part of the federal scrutiny.

Both agencies closed their investigations the following year without bringing charges, although neither publicly explained the decision.

A CFTC spokesperson did not immediately respond to The Post’s request for comment.