Lawmaker Bars Staff From Prediction Markets as New Bills Target Insider Trading
A member of Congress has moved to limit prediction market exercise inside his personal workplace, marking a first-of-its-kind step as lawmakers more and more scrutinize the position of insider info in occasion contract buying and selling.
Rep. Seth Moulton (D-Mass.) introduced Wednesday that his workplace will prohibit workers from collaborating in prediction markets, together with platforms like Polymarket and Kalshi, when buying and selling on political, legislative, or geopolitical outcomes.
The transfer comes as Congress considers a rising slate of payments geared toward limiting or reshaping prediction markets, with some proposals straight addressing issues that authorities officers could also be utilizing inside info to commerce on real-world occasions.
Moulton imposes office-wide ban on workers buying and selling tied to official info
The coverage, which took impact instantly, applies to all personnel in Moulton’s congressional workplace, together with legislative, communications, operations, and district workers.
Under the coverage, workers are barred from buying and selling or holding positions on outcomes tied to authorities exercise or world occasions, significantly the place info is obtained by official duties.
“Prediction markets have grow to be a playground for corrupt insiders,” Moulton stated in an announcement, arguing that the flexibility to commerce on elections, wars, or coverage choices creates “a perverse incentive construction that poses a real menace to American society at this time.”
While restricted to a single workplace, the directive represents a notable escalation in how lawmakers are approaching prediction markets. Rather than ready for clearer federal guidelines or counting on platforms to police the exercise, Moulton’s workplace has successfully adopted a precautionary stance that treats participation itself as a possible battle of curiosity.
“Congressional workers and the Members they work for exist to serve the constituents of the districts they signify, to not revenue off of the very coverage choices and world occasions that we’re right here to reply to,” Moulton stated. “My workplace has not, and won’t, have interaction in these trades that run counter to each precept of a clear, sincere authorities that works for the individuals.”
The coverage doesn’t carve out particular platforms or contract varieties, as a substitute making use of broadly to prediction market exercise tied to real-world outcomes that would intersect with authorities data.
PREDICT Act targets insider participation on the federal degree
In Moulton’s March 25 announcement of the workers prediction markets ban, he known as on “each single American elected official to do the identical.” A brand new House invoice introduced the identical day seeks to codify comparable restrictions throughout the federal authorities.
Led by Rep. Adrian Smith (R-Neb.) and Rep. Nikki Budzinski (D-Ill.), the Preventing Real-time Exploitation and Deceptive Insider Congressional Trading Act — or PREDICT Act — would prohibit members of Congress, senior government department officers, congressional workers, and their instant households from buying and selling on prediction markets tied to political occasions, coverage choices, or different authorities actions.
The bipartisan proposal is explicitly geared toward stopping officers from utilizing delicate or nonpublic info to revenue from occasion contract buying and selling, a priority that has grow to be central to the controversy over prediction markets.
“The American persons are uninterested in politicians utilizing their affect for private acquire, and the rise of prediction markets has made these issues much more related,” Budzinski stated in a information launch, pointing to current instances the place merchants profited from occasions associated to the U.S./Iran conflict and the federal government shutdown.
Smith framed the invoice in comparable phrases, saying public service shouldn’t be “a pathway to revenue” and that passage of the invoice would “give Americans confidence that the selections of their elected officers are guided by benefit, not private revenue.”
Other proposals spotlight widening congressional push on prediction markets
The PREDICT Act is the newest in a quickly rising surge of congressional proposals focusing on prediction markets.
In complete, 13 payments have been launched or introduced in 2026, together with three with companion variations throughout each chambers, reflecting roughly 10 distinct legislative approaches to regulating or limiting the rising market.
Some of these proposals, just like the PREDICT Act, focus particularly on whether or not authorities insiders must be allowed to take part in any respect.
The Public Integrity in Financial Prediction Markets Act, launched in January by Rep. Ritchie Torres (D-N.Y.), would prohibit buying and selling based mostly on nonpublic authorities info. The End Prediction Market Corruption Act, launched earlier this month and led by Sen. Jeff Merkley (D-Ore.) and Sen. Amy Klobuchar (D-Minn.), targets conflicts of curiosity by barring senior officers from collaborating in prediction markets.
At the identical time, lawmakers are additionally pursuing restrictions that transcend insider issues.
A newly introduced bicameral proposal, the STOP Corrupt Bets Act, led by Sen. Merkley and Rep. Jamie Raskin (D-Md.), would impose a sweeping ban on prediction markets tied to sports activities, elections, authorities actions, and navy occasions, in response to reporting by Axios. Rather than specializing in whether or not members of Congress or federal workers can commerce, the invoice would direct regulators to dam whole classes of occasion contracts, with Merkley arguing that permitting well-timed bets on congressional choices or navy actions creates circumstances “ripe for corruption” and undermines public belief.
The flurry of proposals exhibits how Washington is focusing on prediction markets from a number of angles. Moulton, in the meantime, is taking issues into his personal palms by implementing restrictions on the workplace degree. Whether others comply with his lead stays to be seen.
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