US Senate Bans Members and Staff from Prediction Markets

The U.S. Senate unanimously approved a bipartisan resolution on Thursday banning its members and staff from trading on prediction markets, a move prompted by concerns over potential insider information being used for profit. The resolution, which changes the rules of the Senate, goes into effect immediately.

The action comes after a U.S. Special forces soldier was recently charged with utilizing classified information to bet on the capture of Venezuelan President Nicolás Maduro, and amid growing anxieties about potential wagers on the ongoing conflict in Iran.

“United States senators have no business engaging in speculative activities like prediction markets while collecting a taxpayer-funded paycheck, period,”

Sen. Bernie Moreno, R-Ohio

Senator Moreno, the sponsor of the resolution, stated this on the Senate floor. An amendment proposed by Senator Alex Padilla, D-Calif., extended the ban to include congressional staff. Senate Minority Leader Chuck Schumer, D-N.Y., characterized the resolution as a “no-brainer” and urged the House of Representatives and the Trump administration to follow suit.

“We must never allow Congress to turn into a casino where members representing the public can gamble on wars or economic crises or elections,”

Senate Minority Leader Chuck Schumer, D-N.Y.

Schumer warned that such activity would undermine the foundations of representative government. Sens. Todd Young, R-Ind., and Elissa Slotkin, D-Mich., have separately introduced legislation to broaden the ban to encompass all federally elected officials and government employees, prohibiting them from leveraging non-public information for prediction market bets. Young described the Senate resolution as “a good first step” and encouraged consideration of their broader bill.

Growing Scrutiny of Prediction Markets

Prediction markets, including platforms like Polymarket and Kalshi, have faced increasing scrutiny as their popularity and trading volume have grown. Polymarket, in particular, has drawn criticism for facilitating trades originating from outside the United States, potentially placing it beyond the reach of U.S. Regulatory oversight.

Earlier this month, The Associated Press reported on a surge of new accounts on Polymarket making highly specific and timely bets regarding a potential ceasefire between the United States and Iran on April 7. These bets generated substantial profits—hundreds of thousands of dollars—for the new customers. Following the AP’s report, the White House issued a warning to its staff against utilizing private information for trading on prediction markets.

The administration has, however, been a vocal supporter of the prediction market industry in a legal battle against states attempting to prohibit these platforms. Donald Trump Jr., the president’s eldest son, serves as an advisor to both Polymarket, and Kalshi. Trump’s social media company, Truth Social, is preparing to launch its own cryptocurrency-based prediction market, dubbed Truth Predict.

“The whole world, unfortunately, has become somewhat of a casino, and you look at what’s going on all over the world and Europe and every place, they’re doing these betting things,”

President Donald Trump

President Trump made these remarks earlier this month, reflecting a broader observation about the increasing prevalence of betting and speculative activities globally. The Senate’s action represents a significant step towards addressing concerns about ethical conflicts and potential abuses within the burgeoning prediction market industry, particularly among those in positions of public trust.