For the first time, a federal judge has upheld the right to bet on the outcome of a US election.
A Washington judge has struck down a Commodity Futures Trading Commission (CFTC) decision banning gambling companies and customers from betting on the outcomes of congressional elections.
Last Friday, U.S. District Judge Zia Cobb ruled in favor of New York-based Karsi.
A hearing is scheduled for Thursday where Cobb will explain the reasons for the court's decision. As of Thursday afternoon, Karsi could offer up, at least for now, a predictive counterpoint — a yes or no bet — on which party will control the House and Senate after the November elections. The Associated Press reported.
The CFTC immediately appealed the ruling on Thursday.
“Today marks the first trading day in a regulated electoral market in almost a century,” said Tarek Mansour, founder of Qarshi. Post to X“This is for you in the prediction market community.”
It remains to be seen whether the company will offer more political betting, including on presidential elections.
No jurisdiction in the United States allows election betting and it is banned in several states, but gamblers can use foreign websites as a workaround.
In a decision a year ago, the Commission told Karsi he could not offer yes-or-no bets because they constituted illegal gambling against the public interest. The CFTC said betting could be used in a way that harmed the integrity of elections by “creating a financial incentive to vote for a particular candidate.” The Associated Press reported.
The bet is Already Live On Karsi's website Thursday afternoon, individuals shared their opinions on who they thought would win the Senate and House of Representatives.
It costs 75 cents to bet “for” the Republicans to win the Senate and 25 cents to bet “against.” It costs 63 cents to bet “for” the Democrats to win the House and 38 cents to bet “against.”
Better Markets, a nonprofit that advocates for the public interest in financial markets, It said in a statement The decision raises serious questions about the influence of gambling on US elections and calls for “urgent regulatory action,” it said.
