Raskin, Merkley Legislation Would Ban Prediction Market Gambling on Elections, Sports, War and Government Activity

Washington, D.C. - Today, Rep. Jamie Raskin (MD-08) and Senator Jeff Merkley (D-OR) introduced new legislation to crack down on often-times corrupt prediction markets.

Raskin and Merkley's STOP Corrupt Bets Act responds to the recent explosion of prediction markets, which now offer event contracts on everything from elections to sports and acts of war. The bicameral bill would ban prediction market betting on elections, government actions, sports and military actions. These areas are not commodities and have little-to-no value in helping business investments. Initially, event contracts were created to be financial instruments for industries, particularly farmers, to use to hedge against potential losses.

"The oligarchs and opportunists are using prediction markets like Kalshi and Polymarket to enrich themselves. But democracy isn't about insider gambling on our common future, it's about everyone making our common future together. Placing bets on public policy and political events informed by insider knowledge and insider manipulation spreads civic cynicism and distrust in our democratic institutions," said Rep. Raskin. "By banning bets on elections, legislation, acts of war and other government actions, we can oppose corrupt attempts to rig our democracy and profit from the fix, and we can redeem public faith in the idea that government is an instrument for the common good and not a casino."

"When anyone can use prediction markets to make a well-timed bet on Congress passing a bill, government decisions, or a military strike, it's ripe for corruption and erodes public trust," said Sen. Merkley. "The STOP Corrupt Bets Act restores the original intent of prediction markets and prevents these markets from further eroding our democratic institutions and turning them into a casino. I'm ready to work with my colleagues on both sides of the aisle to crack down on this bad bet for democracy and restore our vision of government 'of, by, and for the people,' not government 'of, by, and for the powerful.'"

Prior to 2024, event contracts on elections, sports, and government actions did not exist in the United States. A lawsuit brought by Wall Street firm Kalshi paved the way for election betting just months before that year's presidential election, and the 2026 midterm elections will be the first full election cycle that allows election gambling. This is happening at the same time as reports of individuals using prediction markets to place suspiciously timed bets and earn massive payouts following the fall of former Venezuelan President Nicolás Maduro, ouster of Ayatollah Ali Khamenei, and military actions against Iran.

The STOP Corrupt Bets Act would:

1. Explicitly prohibit event contracts on:
2. 1. Elections and their outcome;
   2. Government actions across all branches unless there's a commercial hedging need;
   3. Sports, and;
   4. U.S. or foreign military actions.
3. Clarify that the intent of Congress in the original statute was that these markets are already against the intent of the Commodity Exchange Act, and that the Commodity Futures Trading Commission (CFTC) must enforce and prevent any market that doesn't have a commercial hedging value to prevent unregulated gambling.
4. Clarify that nothing in this bill preempts any State law that regulates or prohibits gambling or gaming.
5. Require the non-partisan, independent Government Accountability Office (GAO) to conduct a study on prediction markets, insider trading, preventing any other markets that are "gaming" or gambling, the impact on children, and ways Congress can rein in offshore illegal bets.

This legislation also returns the power of regulating gambling to the states by ensuring they can choose to allow gambling and regulate it under state jurisdiction or prohibit it. Notably, this legislation does not prohibit state-regulated gambling, including traditional sports gambling. At least 20 federal suits have been filed against platforms offering prediction markets for their products that are akin to gambling, in direct violation of state law.

The STOP Corrupt Bets Act is cosponsored by U.S. Senators Elizabeth Warren (D-MA), Richard Blumenthal (D-CT), Chris Van Hollen (D-MD) and Sheldon Whitehouse (D-RI).

Raskin and Merkley's bill is supported by Public Citizen, Americans for Financial Reform (AFR), Citizens for Responsibility and Ethics in Washington (CREW), Project On Government Oversight (POGO) and Democracy Defenders Action.

"The prediction market industry has become nothing more than a gambling business by any other name. Recent bets on prediction market platforms on, say, the killing of a national leader or the price of oil that were placed moments before the federal government took actions causing those bets to become reality, suggests those bettors may have had insider information. The federal government should not be in the business of trying to run casinos. The 'STOP Corrupt Bets Act of 2026' by Sen. Merkley and Rep. Raskin would prevent prediction markets from operating as casinos and is heartily endorsed by Public Citizen," said Craig Holman, Ph.D., Public Citizen.

"Recent high-profile instances of bets on war, elections and other political actions underscore the need for better regulation of prediction markets," said Donald Sherman, President and CEO of Citizens for Responsibility and Ethics in Washington (CREW). "These types of event contracts present clear ethical concerns. The STOP Corrupt Bets Act clarifies and extends the law to the most dangerous types of bets in order to combat the risk of bad actors circumventing existing state and federal laws and attempting to manipulate government actions to their own advantage."

"Prediction market platforms must be clear and consistent on what event contracts are allowed and prohibited. Allowing bets on political events, government actions, and military matters undermines public trust and invites corruption. POGO is proud to endorse Sen. Merkley and Rep. Raskin's legislation as a crucial step toward meaningful oversight," said Janice Luong, Policy Associate, Project On Government Oversight.

Full text of the STOP Corrupt Bets Act can be found here.

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Permalink: https://raskin.house.gov/2026/3/raskin-merkley-legislation-would-ban-prediction-market-gambling-on-elections-sports-war-and-government-activity