Cortez Masto, Colleagues Urge CFTC Chair Selig to Uphold Law, Prohibit Prediction Markets Incentivizing Physical Injury, Death or War

Washington, D.C. - Today, U.S. Senator Catherine Cortez Masto (D-Nev) joined Senator Adam Schiff (D-Calif.) and four of her colleagues in urging Commodity Futures Trading Commission Chair Michael Selig to uphold U.S. law and take action to halt prediction contracts that involve betting on physical injury, death or war, and to vigorously enforce the law through oversight and regulation of this market.

"These contracts present dangerous national security risks, including creating incentives to incite violence, foment geopolitical conflicts, and disclose classified information," wrote the Senators. "Under 17 CFR 40.11, the CFTC categorically prohibits contracts that involve, relate to, or reference terrorism, assassination, war, or similar activity contrary to the public interest from being listed. You must clearly reiterate that the CFTC will categorically prohibit any contract that resolves upon or closely correlates to an individual's death-and vigorously enforce the law through oversight and regulation."

The Senators highlight their concerns over recent proliferation of these contracts on exchanges, despite the Commodity Exchange Act expressly prohibiting the listing of contracts that are contrary to the public interest, including in the following categories: war, terrorism, and assassination. The Senators point to recent examples of Polymarket's offshore exchange offering dangerous prediction contracts on whether Artemis II would explode, if Maduro would be removed from power, and whether the Ukrainian town of Myrnohad would be captured by Russian forces.

"These recent events highlight the lack of internal controls and safeguards to prevent insiders from profiting off of non-public information, and direct profiteering off of human suffering…Troublingly, they also underscore the dangerous incentives directly or indirectly tied to offering contracts related to prohibited categories under the CEA. Government officials, regulated entities, consultants who may be in close communication with those effectuating policy change, and other similar parties can easily act on confidential or operationally sensitive information to personally profit in markets that operate with minimal oversight or transparency, or share this information with contacts who can similarly profit," continued the Senators.

Read the full letter here. Additional signatories include Senators Richard Blumenthal (D-Conn.), Cory Booker (D-N.J.), Tim Kaine (D-Va.), and Jacky Rosen (D-Nev.).

As the former top law enforcement official in Nevada, Senator Cortez Masto has spent her entire career working keep Americans safe, online and in their communities. She has cosponsored the bipartisan EARN IT Act protect children online. Her federal legislation to help train law enforcement to identify and prevent child trafficking and to combat human trafficking activity on social media was signed into law. Cortez Masto's provision to increase the number of mental health professionals in schools was included in the bipartisan Safer Communities Act, which was signed into law.

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