Should Politicians Be Able to Use Prediction Markets? House Bill Proposes Ban

Rep. Ritchie Torres (D-NY) and 30 of his Home of Representatives colleagues, together with Former Home Speaker Nancy Pelosi (D-CA), are making a push to ban authorities officers from accessing prediction markets.

The lawmakers launched new laws, the Public Integrity in Monetary Prediction Markets Act of 2026, on Friday morning.

The invoice would cease lawmakers and their employees from collaborating in prediction markets. Within the context of the invoice, that would come with all federal elected officers, political appointees, and staff of the Home of Representatives, Senate, and different government companies.



The invoice argues that D.C. insiders ought to be blocked from collaborating in markets once they possess “materials private data” a couple of market or the flexibility to affect its consequence.

The time period is borrowed from securities regulation and is used to cease individuals with insider details about an organization from buying and selling securities. Prediction markets and the businesses that provide them, like Kalshi and Polymarket, have up to now been solely regulated by the Commodities and Futures Buying and selling Fee.

Earlier this week, Polymarket confronted scrutiny after a dealer received greater than $400,000 on a guess that Venezuelan President Nicolás Maduro can be faraway from workplace earlier than the tip of the month. Criticism targeted on the timing of the guess, which appeared simply hours earlier than U.S. particular forces apprehended Maduro.

“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,” mentioned Rep. Torres, in a press release. “We ignore this plain-sight corruption at our personal peril.”

Torres, Pelosi, and their Home colleagues aren’t the one ones crying foul over what seems to be unfair predictions positioned by individuals with insider data in D.C..

Sen. Chris Murphy (D-CT) included a clip of a latest White Home press convention in his personal criticism of permitting elected officers entry to guess on markets that they will instantly affect.

The clip reveals the final 30 seconds of a White Home press convention, and a timer displaying that the occasion concluded proper earlier than it had lasted 1 hour and 5 minutes—which created an enormous windfall for predictors who guess towards the press convention lasting 65 minutes.

“Who cares in regards to the size of a press convention? What fool is betting on that?” he wrote on X. “However we should always positively care that there are markets that give incentives to individuals with energy to alter outcomes so that they or individuals they know can get wealthy on a giant guess. It is insane we enable this.”

Loxley Fernandes, the CEO and co-founder of Dastan—which owns prediction protocol Myriad and likewise an editorially impartial Decrypt—argued that participation from insiders is extra of a function than a bug.

“Academically talking, prediction markets are some of the efficient instruments for rooting out inside data and maximizing the effectivity and velocity of knowledge transmission,” he mentioned earlier this week.

Whereas he does contemplate insider buying and selling to be an issue, he does take situation with the comparability between prediction markets and conventional playing. “So far, we have now checked out fashionable prediction markets as various casinos—and I consider this framing is wrong,” he added.