Senate bans Senators, staff from trading on prediction markets

The Senate on Thursday unanimously approved a change to its chamber rules that prohibits Senators and their staff from trading on online prediction markets. The restriction is an internal rule enforced by members and does not require approval by the House or the president.

Republican Senator Bernie Moreno of Ohio sponsored the resolution. Moreno wrote on X that “Serving in Congress is an honor, not a side hustle. Americans deserve to know that their leaders are here for the right reason.” Lawmakers backing the measure cited concerns that public officials could use nonpublic information to profit from wagers on political, economic or security outcomes.

The action follows several legislative proposals in Congress that would limit or ban trading by officials. Representative Ritchie Torres introduced the Public Integrity in Financial Prediction Markets Act of 2026 in January to bar federal officials from participating. In March, Senators Jeff Merkley and Amy Klobuchar filed a bill aimed at prohibiting senior executive branch officials from using these platforms. A bipartisan bill from Representatives Blake Moore and Salud Carbajal targets insider trading tied to sensitive military information and democratic processes. Other proposals would restrict markets from offering bets tied to sports, terrorism, assassination, war or an individual’s death.

Federal prosecutors last week charged U.S. Army Special Forces Master Sergeant Gannon Ken Van Dyke in a case that raised alarms about insider trading on prediction platforms. Prosecutors allege Van Dyke used knowledge of the ouster of Venezuelan President Nicolás Maduro to make profitable trades on Polymarket and realized more than $404,000 in illicit gains, according to a related civil complaint filed by the Commodity Futures Trading Commission. Van Dyke was involved in planning and executing the operation identified as Operation Absolute Resolve.

Lawmakers have identified patterns in which anonymous bettors placed successful trades shortly before major announcements, and have pointed to those patterns as potential signs of insider activity. Senator Richard Blumenthal has criticized Polymarket for opening markets that allowed bets tied to national security events and the rescue of a stranded U.S. service member.

Olivia Chalos, deputy chief legal officer at Polymarket, wrote on X that the company operates in compliance with applicable law and that its insider trading rules reflect the standards applied by the CFTC and the courts. She added that the platform shares concern for national security and market integrity.

Several states and private employers have introduced similar rules. Illinois Governor J.B. Pritzker issued a directive barring state employees from using insider information to place bets on prediction markets. Other employers have adopted policies to limit staff participation to avoid conflicts of interest.

Prediction markets allow users to place wagers on the likelihood of future events, with prices that reflect aggregated expectations about outcomes. Lawmakers and regulators are weighing the forecasting and information-aggregation aspects of these markets against the risk that they could create incentives for people with privileged access to exploit confidential information.

Because the Senate change is a chamber rule, it applies only to Senators and their staff and will be enforced internally. Broader federal restrictions would require legislation, and several bills now before Congress would extend prohibitions or tighten rules on who can trade and what outcomes can be offered.