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ribosometronome
CGMthrowaway
This is rules of the Senate, not law, so everything is up to interpretation by the Ethics Committee. And we know how that goes
alex43578
Not a lawyer, but that sounds like the language regulating swaps.
jrmg
Or buying health insurance?
Edit: I guess that’s not dependent on a ‘specific’ future event.
bitshiftfaced
Prediction markets have realized that they will lose potential customers if they don't prevent insider trading. Kalshi already has a policy banning politicians from trading. Presumably they understand this, so while I'm glad to see the rule, I wouldn't say it's that self-sacrificing.
SoftTalker
If they are smart they will stay ahead of government regulation by voluntarily restricting certain types of trading.
warbaker
The real with prediction markets problem is that people can make bets, then alter outcomes to match those bets. This is a well-known issue in sports betting (e.g. taking a fall), and I don't see how we're going to prevent it for things that matter a whole lot more than sports.
ericzundel
Also, a bet in these markets can be used to alter outcomes. That problem is caused by journalists reporting on market activity. It is treated (or percieved by readers) as if it reflects popular sentiment. Not only is it possible, it's actually relatively cheap to do things like corner the market, which in some cases is a lot less expensive than, say, a national TV ad campaign or running a scientific poll. Link to an older article: https://insights.som.yale.edu/insights/dont-trust-the-politi...
perfectstorm
good. and the restriction shouldn’t stop at U.S. Senators. anyone with a major influence in their field should be banned from using these prediction/betting apps. as an NBA fan, I was shocked when I saw the reports about Milwaukee star Giannis allegedly using Kalshi to “predict” his own future team during the last NBA trade deadline. how is that even allowed? he even went on to promote the prediction app the day after the trade deadline.
HDBaseT
How do you police "major influence"?
We've seen OpenAI employees get caught insider trading on prediction markets for new model releases.
Every human is privy to some sort of exclusive information. Polymarket and the likes offer predictions on just about everything that has any relevancy. Sports, Technology, eSports, Politics.
You don't have to have "major influence" to be a beneficiary of insider trading.
jadbox
Note that this is just a code of conduct change for the ethics committee, not a law. Something is better than nothing.
blazespin
Pure gaslighting. The PM panic is because people want to look like they 'care' about corrupt trading. It's peanuts compared to the 500M they were betting on oil futures.
danesparza
ANY government employee or government contract worker should be banned from trading on prediction markets.
verst
In theory as a government employee you already fear getting in trouble with OGE (Office of Government Ethics) and in normal times this is truly enough. Nobody wants to have a conflict of interest or fail to disclose investments etc. However nothing is normal under the current administration...
vjvjvjvjghv
Ethics rules only apply to the lower ranks and as far I know, they are quite strict. Once you move up the chain, most rules become optional.
sarchertech
Every large company should ban employees and contractors from trading on prediction markets. There are so many ways an employee could make money on prediction markets. Causing outages is probably the easiest, but anything that would get the company in the news would do it.
tt24
I find this argument entirely unconvincing.
AWS’s massive outage lead to a significant jump in the stock price.
No single grunt level employee has the power to affect any large company’s share price.
sarchertech
Yeah that’s why I said prediction markets, not stock markets. In a prediction market you’re betting directly on something like “AWS has a major outrage on or before May 12th”.
giarc
The US federal workforce is ~2.2 million people. Banning them all from trading on prediction markets isn't the right move. A cafeteria worker in some suburban admin office likely has no inside information they are going to trade on. Members of congress and other high level positions on the other hand should be banned.
bombcar
Arguably they should ban all US residents, citizens, and immigrants from prediction markets.
Avicebron
Or just ban the companies? Opaque drath pools and gambling markets don't have a right to exist.
ohnei
Why stop at prediction markets? Trading in markets is heavily tied to information or information processing advantage so probably all assets should be held by the government to avoid conflicts of interest involving self interests.
radley
> A cafeteria worker in some suburban admin office likely has no inside information they are going to trade on.
Until they do...
jlarocco
I don't agree. When the senators walk into the cafeteria talking about the bill they're about to pass, the cafeteria worker can easily overhear their insider information.
Avoiding insider trading on prediction markets seems like an intractable problem to me.
throwaway613746
[dead]
xrd
I just can't understand how this prevents, say, the son -in-law of the president (totally unelected) going to negotiate for peace in Iran, while his brother in law is on the board of Polymarket and a strategic advisor to Kalshi.
This is going to ruin interesting conversations at their holiday dinners!
yalogin
So they can vote themselves out to do the right thing, and they purposefully allowing themselves to invest in the stock market with insider information. My cynicism tells me they are throwing this bone to divert attention from the stock market loophole
williamtrask
i'm not sure it's productive to think this way. senators could be making more money on prediction markets. they took a nice step which will lead them to make no money on prediction markets (less money overall). it also sets a precedent which could easily be applied to the stock market.
what you're saying is probably on the mind of at least one Senator, but all things considered, this feels like a net-positive move which they didn't have to do.
nemomarx
I get what you're saying but they did also vote themselves a restriction on stock trading in 2012, so the same behavior as this? If prediction markets get really profitable you might expect the same loophole there too.
cowpig
better is always good
when something you think is bad gets better but not better enough, say "more please"
yalogin
Nice! I like it
williamtrask
i like your comment better than mine. more please.
ASalazarMX
"Prediction market" sounds much better than online gambling.
choward
It's not gambling if you have information that most of the world doesn't have.
arjie
We've learned that these tools are only as effective as the tools of enforcement. A valid technique now available to us is to ban some activity that has valuable returns, then participate in it nonetheless, and simply not enforce action except against those of an opposing tribe. Presumably, violations of this ban simply lead to a hearing before an ethics committee staffed to lean towards the appropriate direction?
Still, it is something. Some chilling effect is better than none. While we do this, it is worthwhile to make prediction markets accessible to our opponents. Ideally, those in corrupt countries aligned against us should be leaking as much information through the markets to us and we should enrich them for it. I'd love to have this kind of distributed espionage with the largest number of bets being on the actions of those aligned against us.
fhn
What about friends, family, neighbors, and benefactors? Prediction markets should be illegal period.
cortesoft
There is a valid purpose for (some) trades in a prediction market, namely as a form of insurance/risk management for specific risks a company or individual might have.
For example, if you are a company whose current business would be severely hurt if a particular piece of legislation passes, it might make sense to hedge that risk by placing a bet on a prediction market that the legislation will pass. That way, if your business is hurt by the legislation, you can use the proceeds to offset the harm and pivot to something else.
Of course, that doesn’t explain most prediction market contracts, but that is the idea at least.
worik
And another thing... What is the harm of malfunctioning insider dominated prediction markets, other than those hedging possibilities evaporating?
I am not taking a position, I am wondering.
When they started they were an academic curiosity and experiment. Now they are becoming a social phenomenon are they more harmful than, say, stamp collecting?
"Fools and their money" is OK so long as the fools are truly volunteering, surely?
vkou
They create another financial incentive for insiders to make decisions focused solely on personal profit, rather than good stewardship of whatever they are in charge of.
I don't give a shit about the addicts losing their money on those markets, I don't want bad decisions to be made that affect me, when the main incentive for making them is fleecing the addicts of their money.
They are just bribery with extra steps.
PeterStuer
Also their spouses? :D
jrmg
Kalshi and its peers are legal because they’re commodity futures trading, not gambling.¹
Are senators not allow to buy any commodities futures now (it reads like it)?
¹I, and I think most reasonable people, think this is ridiculous - it’s obviously gambling in a trenchcoat, but that’s what they claim…
antasvara
To be fair to traditional futures, they don't technically depend on the occurrence or non-occurrence of a specific event. They're an agreement to buy X asset at Y price on Z future date. You may lose money by being forced to buy oil at an above-market rate, but your contract doesn't say anything about the market rate at date Z (as far as I'm aware).
Whereas prediction markets (and some other stock market/commodity option contracts) are explicitly tied to an event. They're saying "I'll give you $1 if this clearly defined event occurs."
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Any lawyers able to comment on the actual wording of the resolution? It kind of reads to me like in their effort to narrowly capture just prediction markets like Kalshi but not stock markets, they've perhaps unintentionally barred themselves from some other unintended things, too.
https://www.moreno.senate.gov/wp-content/uploads/2026/04/FIL...
>No Member of the Senate may enter into, or offer to enter into, an agreement, contract, or transaction that provides for any purchase, sale, payment, or delivery that is dependent on the occurrence, nonoccurrence, or the extent of the occurrence of a specific event.
Kind of seems like Senators would now be barred from like getting home or life insurance and certain kinds of casino gambling. Or like, making an offer on a home that is rescindable upon a failed inspection?