House Lags Senate on Prediction Market Trading Ban

Washington lawmakers continue to allow members of the House and their staffs to place bets on prediction markets that involve elections, policy outcomes and even foreign events, even as reports of insider trading pile up and calls for restrictions grow louder from both parties. The platforms, including Kalshi and Polymarket, have drawn billions in wagers each week on everything from sports results to the fate of political figures. Yet the lower chamber has so far declined to match restrictions already adopted by the Senate.

The issue gained fresh attention after federal prosecutors charged a U.S. soldier last month with using classified information to win more than four hundred thousand dollars betting on the removal of Venezuelan leader Nicolás Maduro. Separate reporting revealed that at least one campaign staffer profited by thousands of dollars by wagering on their own candidate with access to private polling data. These cases have prompted renewed scrutiny of whether government employees and political operatives are leveraging non-public information for personal gain.

Rep. Ritchie Torres, a New York Democrat, introduced legislation last week that would bar campaign staffers from betting on their own races and impose criminal penalties of up to five years in prison for using campaign funds on prediction markets. Torres joined a bipartisan letter urging House leadership to change chamber rules immediately and end what he called an indefensible status quo. More than a dozen similar bills have surfaced this year, according to congressional researchers, but none have advanced beyond early stages.

Critics note that the Senate acted more quickly to limit its own members and staff from participating in these markets. The House, by contrast, has dragged its feet even as the volume of bets on politically sensitive topics has surged. Some lawmakers argue that prediction markets simply reflect public information and improve forecasting, yet the pattern of well-connected bettors cashing in on events tied to their official duties raises obvious questions about fairness and conflicts of interest.

The reluctance to impose tighter rules comes at a time when public trust in institutions is already low. Ordinary citizens cannot access the same briefings or internal data that flow through congressional offices and campaign headquarters. Allowing those with such access to wager on the outcomes they help shape looks to many like another example of rules written for the powerful and ignored by them when convenient.

Kalshi has tried to self-police by blocking certain accounts and markets, but enforcement remains uneven across platforms. Lawmakers from both parties have floated broader regulatory approaches, yet the legislative record shows little appetite for swift action that might affect their own staffs or future political operations. With elections approaching and billions already in play, the delay leaves open a window for continued betting by those closest to the decisions being wagered upon.

The debate has exposed familiar divides. Supporters of open markets claim they provide valuable signals on everything from economic policy to international crises. Opponents, including Torres and several Republican colleagues, counter that the line between legitimate forecasting and outright insider trading has become impossible to police when participants include government insiders. Until the House adopts concrete restrictions, that tension will persist, with profits potentially flowing to those already positioned to influence the results.