A bipartisan‑tinged group of Home Democrats launched laws Friday that might cease federal officers from putting bets on prediction markets — a response to excessive‑profile wagers that critics say look rather a lot like insider buying and selling.
Abstract
- Home members unveiled the Public Integrity in Monetary Prediction Markets Act of 2026, aiming to bar federal officers and employees from taking part in prediction markets.
- The invoice targets officers who might act on materials nonpublic info, prompted by high-profile bets on platforms like Polymarket that critics argue might exploit insider information.
- Critics of the invoice argue that prediction markets can effectively floor info.
The newly unveiled Public Integrity in Monetary Prediction Markets Act of 2026 would prohibit federal elected officers, political appointees, govt department workers, and congressional staffers from shopping for, promoting, or exchanging prediction market contracts on issues tied to authorities coverage, authorities motion, or political outcomes in the event that they maintain or might moderately get hold of materials nonpublic info by way of their official roles.
Rep. Ritchie Torres (D‑N.Y.) and former Home Speaker Nancy Pelosi spearheaded the trouble.
“Probably the most corrupt nook of Washington, D.C. could be the intersection of prediction markets and the federal authorities—the place insider buying and selling and self-dealing are now not imagined dangers however demonstrated risks,” Torres mentioned. “We ignore this plain-sight corruption at our personal peril. Think about, for a second, a member of the Trump Administration have been to put a wager predicting an occasion just like the elimination of Nicolás Maduro.”
The transfer comes after scrutiny of a roughly $400,000 payout on a Polymarket wager tied to Venezuelan President Maduro’s elimination — trades critics say might have benefited from privileged perception into U.S. operations.
Proponents, together with U.S. Senator Chris Murphy, argue that Washington insiders must be blocked from taking part after they sit atop info the general public doesn’t have, a precept drawn from insider‑buying and selling guidelines in securities regulation.
Right here’s what Murphy wrote on X:
Kalshi CEO Tarek Mansour has even backed the invoice, noting his platform already enforces insider‑buying and selling prohibitions, whereas decentralized markets with out strict guidelines have raised equity considerations.
Opponents of restrictions say prediction markets can floor helpful info, however lawmakers pitching the invoice contend the dangers of officers making the most of political or coverage outcomes undermine public belief and name for clearer moral boundaries.
This legislative effort displays heightened scrutiny of how new monetary applied sciences intersect with authorities energy and the boundaries of current regulation.
