Two Democratic lawmakers have introduced federal legislation aimed at blocking prediction-market wagers tied to government military and foreign-policy actions after anomalous betting activity raised concerns about possible insider information.
Representative Greg Casar (D‑Texas) and Senator Chris Murphy (D‑Connecticut) unveiled the Banning Event Trading on Sensitive Operations and Federal Functions (BETS OFF) Act. They say the measure was prompted by “highly unusual” bets on platforms such as Polymarket that implied advance knowledge of a potential US–Israel military action involving Iran. Murphy suggested the trades were likely placed by people with inside information about possible strikes, and Casar warned against allowing officials in a position to decide on war or peace to also profit from wagers tied to those choices.
The bill is part of a broader push in Congress to limit markets that let users speculate on violent or sensitive events. Last week Senator Adam Schiff (D‑California) introduced the DEATH BETS Act, which would prohibit contracts tied to war, terrorism, assassination and individual deaths.
Decentralized and regulated prediction platforms let users bet on outcomes ranging from sports to geopolitics. Polymarket and Kalshi have both offered markets related to the US–Israel–Iran situation; offerings included questions about whether US ground forces would be deployed, timing of a ceasefire, and potential changes in Iranian leadership. Polymarket continued to list several Middle East-related markets at the time of the lawmakers’ announcement and defended prediction markets as tools that “harness the wisdom of the crowd” to produce forecasts mainstream media may not capture.
The activity has generated wider controversy: media reports say a military correspondent received death threats after publishing a story about when an Iranian missile struck Israel—threats that observers believe were meant to influence resolution of a betting market.
Kalshi has steered away from explicit military-action contracts, instead offering events like whether Iran would reach a nuclear deal or if certain elected officials would visit Iran.
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