Published on: March 5, 2026, at 12:42h.
Updated on: March 5, 2026, at 12:42h.
- If enacted, the proposed legislation would prohibit members of Congress, the president, and vice president from engaging in prediction market trades.
- This initiative follows controversies surrounding prediction markets related to US military interventions in Venezuela and Iran.
- Another senator is anticipated to introduce complementary legislation.
In light of insider trading allegations linked to US military moves in Venezuela and Iran, federal legislators are advocating for new bills aimed at preventing high-ranking officials from capitalizing on confidential information through prediction markets.
Today, Senators Jeff Merkley (D-OR) and Amy Klobuchar (D-MN) revealed the End Prediction Market Corruption Act, which seeks to bar the president, vice president, members of Congress, and other top officials from trading in event contracts.
“When government officials exploit confidential information to make profitable bets, it erodes public trust in their commitment to serve the public good rather than their private interests,” Merkley stated. “Strategically timed bets on prediction markets carry an undeniable whiff of corruption. To safeguard public welfare, Congress must enact my End Prediction Market Corruption Act to eliminate this detrimental practice for democracy.”
Cosponsors for this bill include Kirsten Gillibrand (D-NY), Adam Schiff (D-CA), and Chris Van Hollen (D-MD). Schiff, a senator from a state with numerous tribal casinos, stands as a vocal opponent of prediction markets.
Legislation Addressing Geopolitical Trading Sparks Merkley and Klobuchar’s Initiative
The Merkley/Klobuchar proposal showcases an increasing trend of federal lawmakers taking a firm stance against what is seen as insider trading within the realm of geopolitical events.
Evidence suggests that Polymarket, potentially linked to the White House, earned around $400,000 from derivatives associated with the US military operation targeting former Venezuelan dictator Nicolas Maduro, followed by questionable trading related to the Iran conflict.
“As prediction markets have experienced significant growth, reports of unethical behavior have also risen. This legislation enhances the Commodity Futures Trading Commission’s capability to pursue wrongdoers and establishes clear guidelines to stop those with privileged government information from taking advantage of their position for profit,” Klobuchar noted in her statement.
The United States is not alone in addressing the issue of geopolitically motivated insider trading in prediction markets. Recently, Israeli authorities charged two individuals for trading contracts on Polymarket that were linked to military actions in Iran.
Anticipated Legislation from Another Senator
Senator Chris Murphy (D-CT) is poised to present a separate bill focused on insider trading within prediction markets later this month. His proposal aims to prohibit event contracts connected to government actions and related political communications (“mention” markets).
“Clearly, individuals close to Donald Trump had advance knowledge of developments happening on that Saturday. It is highly plausible that those who placed those bets were privy to inside information,” the senator stated on social media.
Murphy’s proposed legislation does not aim to ban economic and financial derivatives available through prediction markets.