Public Integrity in Financial Prediction Markets Act: banning politicians from political betting
“The fact that Bondi didn’t place a seven-figure Polymarket bet on her own firing on her way out the door,” political comedy writer Jeff Maurer posted on Substack, “proves that she was incompetent.”
Context
On the largest online prediction markets, like Polymarket and Kalshi, users can bet on all sorts of political predictions, including:
Which famous people will testify before Congress? Current odds include Mark Zuckerberg at 49%, Anthony Fauci at 22%, Jon Stewart at 16%, and Taylor Swift at 6%.
Who will be awarded the Presidential Medal of Freedom? Current odds include God Bless the U.S.A. (Proud to be an American) singer Lee Greenwood at 36%, Fox News host Sean Hannity at 27%, and former New England Patriots coach Bill Belichick at 15%.
Who will President Trump pardon? Current odds include Edward Snowden at 38%, Sam Bankman-Fried at 25%, Tiger King star Joe Exotic at 18%, and rapper Soulja Boy at 11%.
But what about the people with inside access to this information? For example, members of Congress or their staff who help select those called to testify, or the president and their staff who decide pardons and medals.
Has this ever actually happened?
Has such insider trading among politicians or their staff ever actually happened? It’s unclear.
In February, the CFTC (Commodity Futures Trading Commission) announced its first fines related to insider trading political bets, including one against longshot California Republican governor candidate Kyle Langford. Langford bet $100 on himself to win the upcoming governor’s race in November 2026.
But that’s different than an actual current officeholder making a bet, either about themselves or a political issue for which they have inside knowledge. Federal politicians and their staff don’t currently have to reveal their bets, the way they have to reveal certain other financial information like stock purchases.
So how do we know Langford bet $100 on himself? Because in a social media stunt, he posted about it publicly on X, formerly Twitter.
What the legislation does
The Public Integrity in Financial Prediction Markets Act would ban federal politicians and their staff members from betting on public policy or political outcomes, based on nonpublic info they obtained through their jobs.
While the Senate and House versions share a title and are mostly the same, they differ in a few key ways. Here are three:
The Senate version specifically covers the president and vice president, while the House version does not. The House version says it applies to any “elected official of the federal government,” but that doesn’t necessarily include the president and vice president – indeed, Gerald Ford was never elected as either president or VP.
The Senate version sets a dollar amount fine for a violation: either $500 or twice the value of the profit made through the illegal bet, whichever is higher. The House version doesn’t specify the penalty.
The Senate version requires covered political officials and their staff members to publicly report any covered bets for which they profited $250 or more. The House version does not.
The House version was introduced on January 9 by Rep. Ritchie Torres (D-NY15). The Senate version was introduced two and a half months later on March 25 by Sen. Elissa Slotkin (D-MI).
What supporters say
The legislation’s supporters argue that just as insider trading is illegal, sending no less than Martha Stewart to jail in 2004, it should be illegal in our politics too.
Here’s what both a Republican and Democratic Senate cosponsor had to say about it.
“Public service should never be a pathway to personal profit based on insider information,” Sen. Todd Young (R-IN) said in a press release. “Recent activity in prediction markets has raised real concerns that individuals with access to sensitive, nonpublic information could exploit that advantage for financial gain.”
“No one should be profiting off the information and knowledge gained as a public servant, period,” Sen. Slotkin said in the same press release. “This bill is an important first step in placing common sense rules around prediction markets, and it has real teeth to ensure those who break these rules face real consequences.”
A noteworthy private sector figure also supports the bill: Kalshi CEO Tarek Mansour.
“Kalshi is supportive of the bill Ritchie Torres is looking to introduce to affirm the ban on insider trading on prediction markets,” Mansour wrote on LinkedIn in January. “From day one, we firmly believed in the regulatory-first approach because it is the right thing to do: financial markets come with risks, and regulation helps mitigate these risks.”
What opponents say
Opponents counter that the legislation wouldn’t tackle any of the actual most prominent recent cases regarding apparent insider trading.
“Rep. Torres’s legislation [reflects] a recognition that prediction markets have outpaced the legal frameworks designed to govern them,” Columbia University law professor Joshua Mitts and University of Haifa law professor Moran Ofir wrote in a recent paper. (With the unforgettable title From Iran to Taylor Swift: Informed Trading in Prediction Markets.)
The bill’s “limitation to federal officials trading on government policy information… would not have reached the documented trades in the Venezuelan, Nobel Prize, Google Year in Search, or IDF [Israel Defense Forces] cases, none of which involved a U.S. federal official.”
Other opponents counter that so-called insider trading is actually a good thing in this case, because it makes the listed odds far more accurate.
“Nobody is under the impression that nobody knows the answer, right? Like, of course, there’s people who are working on it that know when it’s going to come,” Polymarket founder and CEO Shayne Coplan said in an interview with Axios.
“And I think what’s cool about Polymarket is that it creates this financial incentive for people to go and divulge the information to the market and the market to change.”
What happens now?
Although the lead House and Senate sponsors each happen to be Democrats, this is a bipartisan effort – at least in the upper chamber.
The Senate version has currently attracted four cosponsors: an exactly even mix of two Democrats and two Republicans. It’s been referred to the Homeland Security and Governmental Affairs Committee.
The 43 current House cosponsors, though, are all Democrats. It’s been referred to both the Administration Committee plus the Oversight and Government Reform Committee.
The reason for the discrepancy between the House version’s partisanship versus the Senate version’s bipartisanship is unclear.
But many House Republicans may be hesitant to support the bill because the Trump administration has generally supported prediction markets and opposes most regulations on them. Indeed, Donald Trump Jr. joined Kalshi in 2025 as a strategic advisor.
One more thing: just last night, in a complete coincidence, Last Week Tonight with John Oliver ran a 33-minute segment about prediction markets, touching on some of these same topics. He didn’t mention the Public Integrity in Financial Prediction Markets Act, though.
Such an obvious ethical position that in a sane world, this would be passed unanimously. But we haven't had one of those in a while. The Trump administration opposes such legislation probably because the family has big financial stakes in the companies that might be limited in some way. So just on "principle."
Very nice summation of the legislation!