A sitting US congressman has banned his total employees from buying and selling on prediction markets, making him one of many first members of Congress to formalize such a prohibition.
Consultant Seth Moulton (D-MA) issued the office-wide coverage efficient March 26, 2026, protecting all personnel throughout legislative, communications, district, and operations groups.
The transfer arrives as Washington is waking as much as an issue it helped create. Nameless merchants have been posting suspiciously giant features on politically delicate occasions — election outcomes, regulatory selections, geopolitical flashpoints — and the finger is pointing squarely at authorities insiders with entry to nonpublic info. The stress on Congress to behave is constructing quick.
Rep. Seth Moulton bans employees from utilizing prediction markets like Kalshi, Polymarket https://t.co/HqtpZKkaFc
— CNBC (@CNBC) March 25, 2026
The Mechanism: How Congressional Insider Buying and selling on Prediction Markets Works
Right here is how the exploit works. Prediction markets allow you to purchase contracts tied to real-world outcomes. Will this invoice go? Will rates of interest rise? A congressional staffer who is aware of a invoice is about to die in committee, earlier than the general public does, should purchase contracts betting on its failure and money out the second the information breaks.
Rep. Seth Moulton referred to as it straight. Prediction markets have grow to be a playground for corrupt insiders inserting bets on election outcomes, wars, and the deaths of public figures. That framing is driving a whole wave of laws.
Prediction markets are probably the most thrilling improvements in monetary markets. But for too lengthy, the @CFTC has failed to supply steerage for these markets being utilized by hundreds of thousands of Individuals. This ends immediately.
Learn what steps the company is taking right here…
— Mike Selig (@ChairmanSelig) March 12, 2026
A minimum of 6 payments concentrating on prediction markets had been circulating in Washington as of late March 2026. The bipartisan PREDICT Act was launched by Reps. Nikki Budzinski and Adrian Smith would ban members of Congress, senior employees, the president, vice chairman, and their households from buying and selling on political or coverage outcomes, with fines equal to 10% of the transaction worth plus full forfeiture of income to the US Treasury.
Rep. Ritchie Torres launched the Public Integrity in Monetary Prediction Markets Act and referred to as it not a ceiling however a ground. Senators Chris Murphy and Jeff Merkley have their very own proposals. The strictest, the BETS OFF Act, would ban government-adjacent trades fully, together with on warfare, terrorism, and the Tremendous Bowl halftime present.
None of those payments is near passing. The Trump administration’s pro-industry posture has considerably slowed momentum. However the political price of inaction on seen corruption is rising.
Prediction market analyst Dustin Gouker expects extra congressional places of work to comply with Moulton’s lead quietly if not publicly. The legislative window is open. It won’t keep that approach eternally.
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