Congressmen Against Betting: New Bill Could Block Kalshi and Polymarket for U.S. Lawmakers
A legislative campaign is gaining momentum in the U.S. to restrict access for members of Congress and their families to prediction markets. Republican Brian Steil, Chairman of the House Committee on House Administration, has introduced the Stop Lawmakers from Predicting Act, which directly prohibits lawmakers, their spouses, and minor children from betting on political events and government decisions through platforms like Kalshi and Polymarket.
The initiative was prompted by concerns that insider information available to parliamentarians could be used to gain an unfair advantage in these markets. Steil emphasizes that Americans should be confident that their elected officials are writing laws, not betting on them.
What exactly the bill prohibits
The document builds on the previously approved Stop Insider Trading Act. The new ban applies to specific government decisions, actions by authorities, and outcomes of political events. Violators face a fine of $2,000 or 10% of the bet amount—whichever is greater. Any profits obtained must be returned. Notably, the fine cannot be paid using official expenses, Senate funds, or political donations. Those who resign without paying the fine may be referred to the U.S. Department of Justice for a civil lawsuit. Importantly, the law does not affect bets on non-political events, such as sports.
Platforms and Congress prepare for new rules
Steil's bill is part of a broader trend toward stricter oversight. In March, Senators Todd Young, Elissa Slotkin, John Curtis, and Adam Schiff introduced their own proposal—the Public Integrity in Financial Prediction Markets Act—aimed at combating insider trading on any platform. The House of Representatives also has a similar PREDICT Act. Earlier, the Senate separately banned senators and their staff from betting on prediction markets.
The market operators themselves are not standing idly by. In June, Kalshi launched a risk assessment system, employment verification, and whistleblower channels to prevent insiders from accessing the platform. Polymarket has partnered with Chainalysis and is building an online monitoring system. Whether the law will be passed largely depends on agreements between Republicans and Democrats—similar initiatives are underway in both the Senate and the House of Representatives.
Cryptalist Analysis: Prediction markets are a powerful tool for gathering information, but their vulnerability to insider trading is obvious. If the bill is passed, it could significantly reduce liquidity and volatility in political contracts, but in the long term, it will strengthen trust in these platforms. Investors should monitor developments: regulation could both clean up the market and create new barriers for retail participants.