Democrats Declare War on Fun: Sports Bets and Election Wagers in the Crosshairs!

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A gaggle of congressional Democrats, no doubt with their quills sharpened and their moral high ground firmly planted, sent a missive to the Commodity Futures Trading Commission (CFTC) on Thursday. Their demand? Ban the wicked practice of event contracts on elections, wars, military shenanigans, sports, and government antics-unless, of course, there’s a bit of economic hedging involved. Oh, the audacity of it all! The letter arrived just as the CFTC’s advance notice of proposed rulemaking comment period was about to shuffle off this mortal coil.

Key Takeaways (or, as we like to call them, the CliffsNotes for the Impatient):

  • Sen. Jeff Merkley, leading the charge with all the subtlety of a troll under a bridge, urged the CFTC to ban event contracts in five categories, including sports. Because clearly, predicting the outcome of a football match is the root of all evil.
  • Merkley, ever the punctual fellow, filed the letter on April 30, the very last day of the CFTC’s 45-day rulemaking input period. Procrastinators unite!
  • Sports, the darling of the prediction markets, drove a whopping 87% of Kalshi’s $39.7 billion in event-contract volume in the year ending February. Who knew so many people cared about whether the Red Sox would strike out again?

Lawmakers Demand the CFTC Write a Rule to Spoil Everyone’s Fun

The senators, in a fit of legislative piety, declared that prediction-market platforms like Kalshi and Polymarket are suffering from a “rapid erosion of integrity.” (Because nothing says integrity like a bunch of politicians telling you what you can and can’t bet on.) They argue that election-related contracts give political insiders a financial incentive to subvert voter intent-as if they needed one. And sports-event contracts? Well, those are just gambling in disguise, intruding on state regulatory authority. Heaven forbid!

The CFTC’s rulemaking notice, published in the Federal Register on March 16, asked the public which event-contract categories might be contrary to the public interest. (Spoiler alert: the public probably said “none,” but what do they know?) Sports contracts, it turns out, are the belle of the ball, accounting for 87% of Kalshi’s $39.7 billion traded in the year ending February, according to a Congressional Research Service insight. Over at Polymarket, sports made up 38% of the $36.2 billion traded. Clearly, people love their sports-and their bets.

This Democratic move contrasts sharply with the CFTC’s current regulatory posture under Chair Michael Selig. In a recent interview, Selig identified manipulation and insider trading as the “biggest issue” in prediction markets but insisted that exchanges are the first line of defense. (Because nothing says “first line of defense” like a self-regulatory organization with quasi-governmental authority.) Selig didn’t rule out future restrictions on prop bets and parlays, but for now, the fun continues-much to the Democrats’ dismay.

This latest salvo follows a March 29 letter from a similar group of lawmakers urging the CFTC and the Office of Government Ethics to crack down on federal-employee insider trading on prediction markets. The catalyst? A U.S. Army sergeant, Gannon Ken Van Dyke, was indicted for trades tied to the capture of Venezuelan leader Nicolás Maduro. Van Dyke, ever the optimist, pleaded not guilty earlier this week. Because who doesn’t love a good gamble, even if it’s on your own mission?

Several legislative proposals targeting prediction markets have been introduced this year. Merkley, Sen. Elizabeth Warren, and Rep. Jamie Raskin introduced the STOP Corrupt Bets Act, which would prohibit federally regulated event contracts on elections, sports, government actions, and military moves. (Because nothing says “freedom” like banning people from betting on things.) A separate bipartisan bill from Sens. Adam Schiff and John Curtis would block CFTC-registered platforms from offering sports-event contracts. Because bipartisanship is alive and well-when it comes to spoiling everyone’s fun.

The CFTC, meanwhile, has been busy asserting its exclusive federal jurisdiction over event contracts. The agency sued Arizona, Connecticut, and Illinois on April 2, and has since filed similar actions against New York and Wisconsin, accusing them of encroaching on federal authority. (Because nothing says “federal authority” like suing states for trying to enforce their own laws.) The Third Circuit Court of Appeals affirmed an injunction barring New Jersey from enforcing its gambling laws against Kalshi’s sports-event contracts on April 6. Arizona, not to be outdone, filed a 20-count criminal information against Kalshi’s CFTC-registered exchange-the most aggressive state-level action to date. But fear not, the courts have temporarily stood down the prosecution. For now.

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2026-05-01 01:57