TLDR
- Senator Chris Murphy and Rep. Greg Casar introduced the BETS OFF Act to ban prediction market bets on government decisions, military actions, and terrorism
- Around 150 Polymarket accounts placed unusual bets before US strikes on Iran, with one person making nearly $500,000
- The bill would impose criminal penalties on operators and block payment processing for banned platforms
- Lawmakers highlighted Trump family financial ties to Polymarket and Kalshi, including a Trump-branded prediction market
- Polling shows 59% of voters oppose wagering on government actions, with 82% concerned about terrorism-related markets
US lawmakers have introduced a new bill that would make it illegal to place bets on government decisions, military strikes, and other sensitive events. The legislation targets popular prediction market platforms like Kalshi and Polymarket.
The bill is called the Banning Event Trading on Sensitive Operations and Federal Functions Act, or BETS OFF Act. It was introduced by Senator Chris Murphy of Connecticut and Representative Greg Casar of Texas.
Several other lawmakers are co-sponsoring the bill. They include Senator John Hickenlooper of Colorado and Representatives Yassamin Ansari, Gabe Amo, and Rashida Tlaib.
Murphy called prediction markets “fundamentally corrupt markets rife with insider trading” during a press conference on Tuesday. The bill would also amend existing gambling laws to block payment processing for banned platforms.
Criminal penalties would apply to US individuals who promote or operate these markets. Prediction market companies have pushed back, arguing their platforms are forecasting tools regulated under federal derivatives oversight.
Suspicious Activity Before Iran Strikes
The lawmakers pointed to what they described as unusual betting patterns on Polymarket before US military strikes on Iran. Casar said around 150 accounts placed bets the day before the strikes that military action would begin the next day.
Of those accounts, 109 made more than $10,000. Sixteen accounts made over $100,000, and one person earned nearly half a million dollars.
Murphy said most of those accounts were created on the same day the bets were placed. He argued this suggested people with advance knowledge of the attack may have profited.
Lawmakers also said similar betting activity was seen ahead of a US operation in Venezuela. Casar said working-class service members were being sent to fight while others were cashing in.
Trump Family Ties and Political Pushback
Beyond the insider trading concerns, Murphy argued that prediction markets create dangerous incentives for government officials. He said people advising the president may be making decisions based on their bets rather than national security.
The bill would also cover private-sector events where one person controls or knows the outcome. That includes bets on what words a politician might say or who will perform at the Super Bowl halftime show.
Both lawmakers raised concerns about the Trump family’s financial connections to prediction market companies. Casar noted that Donald Trump Jr. is an investor in Polymarket and a paid advisor to Kalshi.
Trump Jr. is also developing a Trump-branded prediction market called Truth Predict. Casar said the current administration would not crack down on this kind of activity because they are profiting from it.
Murphy described a broader pattern set by White House leadership. He said the president is sending a signal to staff that they should use their proximity to power to make money.
When asked about Republican support, Casar acknowledged the difficulty. He said private conversations with some Republican colleagues showed awareness of the risks but noted the political challenge.
Murphy said the BETS OFF Act is one of several congressional proposals targeting prediction markets. Other bills focus on sports betting and election-related markets.
Polling from Data for Progress found that 59% of voters oppose wagering on government actions. That includes 60% of Democrats, 61% of Independents, and 57% of Republicans.
Support for banning elected officials from prediction markets is even higher at 67%. Concern is strongest around markets tied to terrorism at 82% and political assassinations at 78%.
