US senators move to ban officials from prediction market trading
Table of contents
- Senators Jeff Merkley and Amy Klobuchar introduced the End Prediction Market Corruption Act.
- The bill would ban the President, Vice President, members of Congress, and senior officials from trading event contracts.
- Violations would carry civil penalties of at least $10,000 plus disgorgement of trading profits, per bill summaries.
Two US senators have introduced legislation that would prohibit senior government officials from trading on prediction market platforms such as Kalshi and Polymarket.
The bill, introduced on 5 March 2026, responds to mounting concerns that officials with access to classified or non-public information could exploit that advantage for personal financial gain.
What the bill proposes
The legislation, titled the End Prediction Market Corruption Act, was introduced by Sen. Jeff Merkley (D-OR) and Sen. Amy Klobuchar (D-MN). It would bar the President, Vice President, members of Congress, and other senior federal officials from trading event contracts on any prediction market platform.
Cosponsors include Senators Chris Van Hollen (D-MD), Adam Schiff (D-CA), and Kirsten Gillibrand (D-NY). The bill has received endorsements from Public Citizen, the Citizens for Responsibility and Ethics in Washington (CREW), and the Project On Government Oversight (POGO).
Under the proposed framework, violators would face civil penalties of at least $10,000 per violation, plus disgorgement of trading profits, according to bill summaries published by the sponsors.
The bill would also strengthen the Commodity Futures Trading Commission’s (CFTC) authority to investigate potential insider trading on event contract platforms.
Sen. Jeff Merkley said:
“When public officials use non-public information to win a bet, you have the perfect recipe to undermine the public’s belief that government officials are working for the public good, not for their own personal profits.”
Sen. Amy Klobuchar said:
“At the same time that prediction markets have seen huge growth, we have seen increasing reports of misconduct. This legislation strengthens the Commodity Futures Trading Commission’s ability to go after bad actors and provides rules of the road to prevent those with confidential government or policy information from exploiting their access for financial gain.”
Triggered by geopolitical controversies
The proposal follows a series of incidents that raised alarm about potential insider trading on prediction markets.
In late February, blockchain analytics firm Bubblemaps identified six wallets that collectively earned $1.2 million by placing highly targeted bets on Polymarket shortly before US strikes on Iran. Many of those wallets had been funded within 24 hours of the trades and specifically wagered on the exact date of the military action.
Earlier in 2026, a single anonymous Polymarket user reportedly earned more than $400,000 by correctly predicting US military intervention in Venezuela. Merkley noted that this information was so tightly held that the Secretary of State acknowledged Congress had not been notified in advance.
Kalshi, one of the largest CFTC-regulated prediction market platforms, was consulted before the bill’s introduction and backs efforts to police insider trading on regulated platforms, according to a company spokesperson.
Prospects and political dynamics
The bill faces a challenging path in the current Republican-controlled Congress. It carries no Republican cosponsors to date, making passage unlikely in its current form at this early stage. However, proponents view the legislation as a foundational regulatory framework for an industry growing faster than the rules governing it.
Additional proposals are expected. Sen. Chris Murphy (D-CT) is reportedly preparing a separate bill that would target event contracts tied directly to government actions and statements by politicians.
In the House, Rep. Ritchie Torres has introduced a narrower measure that would only restrict officials who possess or could reasonably obtain material non-public information.
The prediction market sector has grown rapidly since the 2024 US presidential election cycle, when platforms like Polymarket and Kalshi attracted significant mainstream attention.
As trading volumes increase and the types of events offered expand into geopolitics, warfare, and economic policy, lawmakers across both chambers are scrambling to define where these platforms fit within existing regulatory structures.
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