Congressman Moves to Ban Officials From Betting on Prediction Markets

Torres Targets Prediction Market Activity

Democratic Rep. Ritchie Torres is preparing to introduce the Public Integrity in Financial Prediction Markets Act of 2026, legislation that would prohibit federal elected officials, political appointees, and executive branch employees from placing bets on prediction markets linked to government policy, political outcomes, or official actions.

The proposal aims to close what Torres views as a dangerous loophole-one that could allow officials with access to non-public or sensitive information to profit from political events.

Maduro Bet Triggers Urgency

The legislative push follows a controversial wager placed on Polymarket, where a user bet that Venezuelan President Nicolás Maduro would be “out” by the end of the month. The bet reportedly netted around $400,000, according to Axios, and immediately raised concerns about potential inside knowledge.

Those concerns intensified after Donald Trump publicly disclosed that U.S. forces had taken Maduro and his wife, Cilia Flores, into custody. U.S. prosecutors allege Maduro played a central role in large-scale cocaine trafficking, operating under the protection of Venezuelan law enforcement.

Maduro and Flores pleaded not guilty on Monday, according to multiple reports.

“As Soon As Possible”

A spokesperson for Torres said the bill had been under development prior to the Venezuela incident, but the Polymarket wager made clear that action was needed immediately.

At this stage, the proposal does not introduce new enforcement agencies or penalties, instead relying on existing legal frameworks. However, Torres’ office emphasized that the bill is intended as a starting point, with further amendments and enforcement mechanisms likely to follow.

Prediction Markets Under Growing Scrutiny

Prediction markets such as Polymarket and Kalshi surged in popularity throughout the 2024 U.S. election cycle, allowing users-often using crypto-to bet on political races and outcomes.

Their rapid growth has attracted both retail users and political insiders. Notably, Donald Trump Jr. holds advisory roles at both platforms, adding to the political sensitivity surrounding their operations.

While proponents argue prediction markets offer valuable forecasting insights, critics warn they can become tools for profiteering on privileged information, especially when government officials or their associates are involved.

Crypto, Politics and Trust

Torres is also a member of the House Financial Services Committee, where he sits on the digital assets subcommittee, placing him at the center of debates around crypto regulation and market integrity.

As prediction markets continue to blur the line between finance, crypto, and politics, the proposed legislation signals that Washington is increasingly unwilling to tolerate even the appearance of conflicts of interest.

Whether the bill gains traction remains to be seen-but the message is clear: political power and political betting may soon be legally incompatible.