Senate Bans Lawmakers, Staff From Prediction Market Trading

On Thursday the Senate voted unanimously to add a rule to its chamber rulebook banning Senators and their staff from trading on prediction markets. The change does not require House approval or the president’s signature and will be enforced through Senate procedures.

Senate leaders said the rule is meant to prevent conflicts of interest as probes and legislation addressing prediction markets move through Washington. Violations will be handled internally by members under existing chamber rules rather than through criminal or civil courts.

Lawmakers stepped up scrutiny after anonymous bettors placed profitable trades just before major public announcements, prompting concerns about insider activity. Federal prosecutors last week charged U.S. Army Special Forces Master Sergeant Gannon Ken Van Dyke, alleging he used advance knowledge of the ouster of Venezuelan President Nicolás Maduro to profit on Polymarket.

The Justice Department’s criminal complaint and a separate civil action by the Commodity Futures Trading Commission say Van Dyke made more than $404,000 in illicit gains while involved in planning and executing an operation referred to as Operation Absolute Resolve.

Several bills in Congress would limit federal officials’ participation in prediction markets. Representative Ritchie Torres introduced the Public Integrity in Financial Prediction Markets Act of 2026 to bar federal officials from trading on these platforms. Senators Jeff Merkley and Amy Klobuchar filed a proposal to prohibit senior executive-branch members from trading. Representatives Blake Moore and Salud Carbajal introduced a bipartisan measure aimed at insider trading tied to sensitive military information and democratic processes.

Other proposed legislation would restrict markets that offer wagers on sports outcomes or on topics such as terrorism, assassination, war or the death of an individual. The Commodity Futures Trading Commission has brought civil actions related to trading on these platforms while regulators and lawmakers assess whether existing securities and derivatives laws cover event-based prediction markets.

Illinois Governor J.B. Pritzker issued an order barring state employees from using inside information to trade on prediction platforms. Platforms operating prediction markets have defended their practices. Polymarket’s deputy chief legal officer, Olivia Chalos, wrote on X that the company “operates in full compliance with applicable law” and that its insider trading rules match the lines drawn by the CFTC and courts.

Senator Bernie Moreno, who sponsored the Senate rule change, wrote on X that public service should not be mixed with personal trading and added, “Serving in Congress is an honor, not a side hustle.” Senator Richard Blumenthal criticized platforms that allow markets tied to national security secrets and pointed to a market that invited bets on the rescue of a U.S. soldier.