Senate Unanimously Bans Prediction Market Trading for Members, Staff
The US Senate passed a unanimous ban on prediction market trading by all members and staff. The action follows insider trading charges against a US Army Special Forces Master Sergeant who allegedly profited from classified information.
Key Takeaway
Lawmakers shut down their own prediction market access after insider trading scandals exposed conflicts of interest.
Senator Bernie Moreno sponsored the bill that passed on Thursday with no opposition. "Serving in Congress is an honor, not a side hustle," he said during the proceedings. "Americans deserve to know that their leaders are here for the right reason!"
The ban came after the Justice Department charged Gannon Ken Van Dyke, a 38-year-old US Army Special Forces Master Sergeant, with insider trading on Polymarket. Van Dyke allegedly used knowledge of Venezuelan President Nicolás Maduro's ouster to place bets, earning ₱24,920,182 ($404,000) in illicit profits according to a civil complaint filed by the Commodity Futures Trading Commission.
Senator Richard Blumenthal has been one of the loudest critics of prediction markets, accusing Polymarket of letting users profit off national security secrets. He pointed to markets allowing bets on whether US soldiers would be rescued in Iran as evidence the platform had gone too far. "Polymarket operates in full compliance with applicable law, and our insider trading rules are the exact lines that the CFTC and courts draw for derivatives markets," said Polymarket Deputy Chief Legal Officer Olivia Chalos in response.
Multiple bills are working through Congress to restrict prediction market access. New York Representative Ritchie Torres presented the Public Integrity in Financial Prediction Markets Act in January. Senators Jeff Merkley and Amy Klobuchar filed a bill in March to prohibit senior executive branch members from trading on these platforms. Representatives Blake Moore and Salud Carbajal co-authored a bipartisan bill to rein in insider trading involving military secrets and democratic processes.
The regulatory pressure extended beyond Congress. National Public Radio banned its editorial employees from trading on prediction markets in April. Illinois Governor JB Pritzker banned state employees from using insider information to bet on prediction markets in late April. The Senate's new rule takes immediate effect and prohibits any member or staff from trading on prediction markets, effective May 1, 2026.
This article was written based on reporting from Dlnews.
