Congress moves to ban betting on prediction markets

Congress seeks to ban sports and political betting on prediction markets, citing market integrity and security concerns, despite industry pushback over innovation and information aggregation.

US lawmakers have introduced bipartisan bills aimed at banning sports and political betting on prediction markets such as Kalshi and Polymarket. The proposed legislation would prohibit CFTC-regulated platforms from offering contracts tied to sporting events, casino-style games, and sensitive political outcomes, including acts of terrorism and declarations of war. Supporters of the bills argue that these measures are necessary to protect market integrity, national security, and state consumer protections. They express concerns that prediction markets blur the line between financial derivatives and gambling, potentially exposing markets to manipulation and insider trading risks. The legislation reflects growing bipartisan support for stricter oversight, especially as states like Nevada and Arizona mount legal challenges. However, proponents of prediction markets warn that such bans could stifle innovation and limit the aggregation of valuable information.