Sponsors
The bill reduces gambling-like, event-based derivatives to protect market integrity and state gambling authority, but does so at the cost of narrowing hedging options, creating regulatory uncertainty, and risking migration of activity to less transparent markets.
Financial institutions and ordinary investors will face fewer event-linked speculative contracts available to be cleared or traded, reducing gambling-like activity and improving market integrity and stability.
Financial institutions will be allowed a narrow hedging exemption for contracts tied to government actions, enabling some firms to mitigate commercial risk from regulatory or legislative changes.
State governments will retain the ability to apply their gambling laws (federal law would not preempt state gambling regulation), preserving local authority to protect consumers.
Financial institutions and some businesses will lose legal venues and tools to hedge or transfer event-related risk, likely increasing hedging costs and risk exposure for firms and small-business owners.
Middle-class investors and market participants could be pushed into unregulated OTC markets for event-linked contracts, reducing transparency and potentially increasing systemic and consumer risk.
Financial institutions and taxpayers face legal and regulatory uncertainty because the bill includes a nonbinding "sense of Congress," which does not create enforceable rules and may leave outcomes unclear.
Based on analysis of 4 sections of legislative text.
Bans listing, clearing, or trading on registered U.S. entities of event-linked contracts (elections, government actions, sports, military), requires a GAO study, and urges CFTC to bar non-hedging prediction markets.
Introduced March 26, 2026 by Jamie Ben Raskin · Last progress March 26, 2026
Prohibits listing, clearing, or trading on registered U.S. entities of agreements, contracts, transactions, or swaps tied to specified event-based “prediction” markets (including political elections, government-branch actions, sports contests, and military actions), while allowing narrow hedging exemptions. Requires the Government Accountability Office (GAO) to complete and publish a study on prediction markets — including insider trading and effects on 18–20-year-olds — within 60 days and expresses Congress’s view that the Commodity Futures Trading Commission (CFTC) should bar non-hedging event contracts and that State laws on gambling are not preempted. Imposes a statutory prohibition in the Commodity Exchange Act framework against trading event contracts on registered entities, directs regulatory attention to preventing prediction markets that function as gambling, and seeks policy recommendations and enforcement options from a rapid GAO study.