TLDR
- Six Democratic senators wrote to the CFTC urging a clear ban on prediction market contracts tied to death or injury
- The letter was led by Sen. Adam Schiff and sent to CFTC Chairman Michael Selig
- Federal rules already ban contracts linked to terrorism, assassination, and war — senators want death-related contracts added explicitly
- The letter called out Polymarket contracts on a NASA explosion, Venezuela’s Maduro, and Russia’s Ukraine invasion
- The CFTC recently reasserted exclusive federal jurisdiction over commodity derivatives markets
Six Democratic senators are calling on the Commodity Futures Trading Commission to explicitly ban prediction market contracts that are tied to a person’s death or injury.
The letter was sent Monday to CFTC Chairman Michael Selig. It was led by Sen. Adam Schiff of California.
The other senators who signed are Richard Blumenthal, Cory Booker, Tim Kaine, Catherine Cortez Masto, and Jacky Rosen.
The senators say these contracts “incentivize physical injury or death” and “present dangerous national security risks.” They want Selig to make clear the CFTC will “categorically prohibit” any contract that resolves on or closely relates to someone’s death.
The letter points out that federal commodity rules already ban contracts linked to terrorism, assassination, and war. The senators argue death-related contracts should fall under the same rules.
The letter specifically named three recent contracts on Polymarket. These involved predicting a NASA spaceship explosion, the removal of Venezuelan leader Nicolas Maduro, and the Russian military capturing a Ukrainian town.
The senators wrote that these examples show “a lack of internal controls and safeguards to prevent insiders from profiting off non-public information.”
They also said the contracts represent “direct profiteering off of human suffering.”
Prediction Markets Under Growing Scrutiny
Prediction markets like Polymarket and Kalshi have grown quickly in popularity. This growth has brought more regulatory attention and questions about oversight, gambling addiction, and insider trading risks.
The letter also noted the CFTC recently cleared the way for Polymarket to re-enter the U.S. market. U.S. users had previously been blocked from the company’s offshore exchange.
The CFTC did not immediately respond to a request for comment on the letter.
CFTC Asserts Federal Control
Last week, the CFTC filed a legal brief in a federal appeals court. It stated that the commission holds exclusive jurisdiction over U.S. commodity derivatives markets and that states have no role in oversight.
Chairman Selig wrote in a Wall Street Journal op-ed that the “CFTC will no longer sit idly by while overzealous state governments undermine the agency’s exclusive jurisdiction.”
Selig currently serves as chief counsel on the SEC’s crypto task force. He also advises SEC Chair Paul Atkins.
The CFTC’s brief and the senators’ letter both arrive as the agency is taking a more active role in shaping how prediction markets operate in the United States.
The senators’ letter has not been previously reported. The CFTC has not yet publicly responded.
