A new bipartisan bill in Congress would prevent top US officials from wagering on prediction markets tracking politics and government actions. Lawmakers believe this is necessary to prevent insider betting on events these officials witness or influence in public.
What the PREDICT Act Would Ban
Senior officials in Washington are the focus of the Preventing Real-time Exploitation and Deceptive Insider Congressional Trading Act, or PREDICT Act. It would prohibit wagering on prediction markets related to political events, policy choices, or other government acts by the president, vice president, all members of Congress, top executive branch officials, political appointees, and their spouses and dependents.
The bill covers both regulated platforms like Kalshi and crypto-native websites like Polymarket that run on public blockchains. Lawmakers drafted the language to distinguish prediction markets as a separate product class rather than treating them like standard futures contracts or conventional securities.
Representatives Nikki Budzinski, an Illinois Democrat, and Adrian Smith, a Republican from Nebraska, are leading the PREDICT Act in the House. Their promotional materials portray the measure as a direct response to recent accusations of questionable, calculated wagers on geopolitical and policy outcomes.
Both sponsors argue that existing ethics and trading rules, including the STOCK Act, did not anticipate event contracts on prediction platforms. They say that the gap lets officials legally place trades that look like bets on their own decisions, even when they hold sensitive information the public cannot see.
Penalties And Enforcement
Under the PREDICT Act, any covered official who makes a banned trade would face a civil fine equal to 10 percent of the value of the transaction. They would also have to give up all profits from the contract, which would go to the U.S. Treasury.
The bill does not rewrite criminal law but instead adds a clear civil enforcement tool that ethics offices and regulators could use. Supporters say that clarity is important because it draws a bright line: if you hold a senior federal job, you cannot bet on political or policy markets at all.
The PREDICT Act is one of several proposals now circling prediction markets in Washington. Other bills seek to ban sports-style contracts on CFTC-regulated venues or restrict trading by federal employees who hold nonpublic information, even if they are not in top posts.
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