Senators Banned from Using Insider Information for Prediction Markets

The Senate has taken a significant step by passing a bill that prohibits senators and their staff from participating in prediction markets like Calci and Polymarket. This decision came right before a week-long break from Washington, D.C.

These prediction platforms allow individuals to wager on various topics, extending from global events and elections to the outcomes of conflicts and celebrity divorces.

New Regulations on Prediction Market Participation

Sponsored by Sen. Bernie Moreno (R-Ohio), the bill saw unanimous support in the Senate and has led to an immediate update in Senate regulations. Moreno explained that the purpose of the bill is to address the unease some lawmakers feel about “side jobs.” It aims to boost public trust in the legislative process, especially as previous attempts to restrict stock trading by lawmakers while in office haven’t succeeded.

Moreno voiced his concerns, stating, “I don’t think you should trade stocks at all. It’s just insane. We need to ensure that voters believe their representatives are acting in the state’s best interest.” This sentiment reflects a growing desire among some lawmakers to distance themselves from potential conflicts of interest.

Calls for Similar Legislation in the House

Senate Minority Leader Chuck Schumer from New York praised the Senate’s decision and urged the House to follow suit. He pointed out that it’s essential for Speaker Johnson to implement similar restrictions:

“Speaker Johnson should immediately do the same on the House floor,” Schumer remarked.

Meanwhile, Rep. Ashley Hinson (R-Iowa) is advocating for similar legislation in the House as she aims to take the place of retiring Sen. Joni Ernst (R-Iowa).

Support from Prediction Market Companies

Companies involved in prediction markets have welcomed this legislative move. Polymarket expressed their support, stating, “We fully support this. Codifying this into law is a significant advancement for the industry.” They noted that their existing policies already prohibit such practices but welcomed the legal reinforcement.

Tarek Mansour, co-founder of Karshi, echoed similar sentiments, encouraging the House to enact comparable measures. He mentioned, “Kalsi is already actively blocking members of Congress and cracking down on insider trading, which sets a precedent for improving market confidence.”