US Democratic lawmakers have introduced a bill aimed at restricting prediction markets that allow wagering on government actions, military operations, or events influenced by insiders. The Banning Event Trading on Sensitive Operations and Federal Functions (BETS OFF) Act was filed by Senator Chris Murphy and Representative Greg Casar, alongside several Democratic co-sponsors in both chambers of Congress.
The bill would prohibit prediction market contracts linked to government decisions, terrorism, war, assassination, and any event where the outcome is known or controlled by a single person. It also encompasses events like entertainment awards or the Super Bowl halftime show if the result is predetermined. Murphy explained, “Our legislation is pretty simple. It simply says that these markets cannot allow people to make bets on government decision-making and frankly on other instances where there is one single individual who controls and knows the outcome of a market.”
Insider Trading And National Security Concerns
The BETS OFF Act responds to incidents on platforms such as Polymarket, where users reportedly placed bets immediately prior to US military actions in Iran and Venezuela. Wagers included more than $500 million on the timing of attacks and another $150 million on the removal of Ayatollah Ali Khamenei from power. These timely bets generated substantial profits, raising alarms about insider trading and exploitation of privileged information.
Co-sponsor Rashida Tlaib said, “It’s sickening that people just made millions of dollars by betting on the US attacks on Iran and Venezuela. Congress must ban profiting from war and war crimes.” Murphy also emphasized that such platforms could create incentives for officials to make policy decisions influenced by personal financial gain rather than national security.
Related Legislative Efforts
The BETS OFF Act is part of a broader congressional push to regulate prediction markets more tightly. Earlier this month, Representative Mike Levin and Senator Adam Schiff introduced the DEATH BETS Act, which would ban contracts involving death, terrorism, or assassinations under the Commodity Futures Trading Commission’s oversight.
Additional bills, including the Event Contract Enforcement Act and the Public Integrity in Financial Prediction Markets Act, similarly aim to prevent US officials or others with insider knowledge from trading on high-impact events. Tennessee Senator Ferrell Haile’s Senate Bill 1992 targets outcomes influenced by participants in prediction markets, treating interference as a Class E felony.
Public Sentiment And Enforcement
Polling cited in the BETS OFF Act shows broad support for banning prediction market wagers on government or sensitive events. Around 61 percent of independent voters and 57 percent of Republicans back restrictions on government-related bets, while opposition rises to 80 percent for markets tied to terrorism or assassinations.
Proponents argue the risk extends to any event where participants may have advance knowledge or influence over outcomes, including sports or entertainment events.
The legislation also seeks to expand enforcement to offshore platforms, targeting US-based operators or payment processors, while imposing criminal penalties for violations. The Commodity Futures Trading Commission is expected to integrate these restrictions into its regulatory framework for prediction markets.
Source:
“US Democratic lawmakers introduce bill to crack down on prediction markets”, reuters.com, March 17, 2026
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