A newly introduced bill, the Stop Lawmakers from Predicting Act, aims to ban members of Congress from betting in prediction markets. The legislation, introduced by U.S. Rep. Bryan Steil, R-Wis., would forbid members of Congress, their spouses, or their dependent children from betting on the outcome of a specific government policy or action.
Background
Prediction markets, such as Polymarket and Kalshi, have become a point of contention in recent months. Government watchdogs have criticized these markets for allowing U.S. lawmakers to profit from information not available to the public. The Stop Lawmakers from Predicting Act builds upon Steil’s Stop Insider Trading Act, which passed out of the House Administration Committee in January but has seen no further advancement.
Dylan Hedtler-Gaudette, interim vice president of Policy and Government Affairs at the Project on Government Oversight, believes the bill is a step in the right direction. “If there is an opportunity to address the issue piecemeal by banning one cohort of federal officials and then moving on to the next – if that’s what we have to do, then that’s what we have to do,” Hedtler-Gaudette said. “It’s a lot better than the status quo, which is that we have almost no strong conflicts of interest restrictions for anybody in the federal government.”
Concerns and Implications
The legislation has sparked concerns about the potential for government officials to use inside information to influence policy decisions. Hedtler-Gaudette noted that prediction market bidding by government employees with insider information poses a danger of corrupting public policy making. “The danger that we see with prediction markets is that they just provide too many opportunities to game the system with inside information,” he said.
The Stop Lawmakers from Predicting Act doesn’t include congressional staff and only imposes a civil penalty for violations – a fine of $2,000 or 10% of the value of the prohibited transaction, whichever is greater, as well as the net gain realized from the transaction. The Project on Government Oversight has called for a more comprehensive solution, including a ban on prediction market betting for all federal officials.
Original reporting: KTBS 3 (Shreveport) — read the source article.
