Representative Seth Moulton (D-MA) has banned all congressional staff from trading on prediction markets like Polymarket and Kalshi, citing concerns over insider trading. The move aligns with a bipartisan legislative push, including the newly introduced PREDICT Act, which seeks to extend similar prohibitions to senior government officials and impose financial penalties for violations.
Massachusetts Democrat Seth Moulton has instituted an office-wide policy prohibiting all congressional staff from trading on prediction market platforms. The ban, effective immediately, covers positions on political, legislative, regulatory, or geopolitical outcomes.
“Prediction markets have become a playground for corrupt insiders who are able to place bets on things like election outcomes, wars, and even the deaths of public figures,” Moulton stated. He warned this creates a perverse incentive structure posing a genuine threat to society.
The action comes as bipartisan lawmakers introduce the PREDICT Act, or the Preventing Real-time Exploitation and Deceptive Insider Congressional Trading Act. This bill would prohibit members of Congress, the President, Vice President, and other senior officials from trading on political events or government actions.
Violations under the proposed act would carry a civil penalty of 10% of the transaction’s value plus full disgorgement of profits. This legislative push follows other recent bills targeting prediction markets on sports, terrorism, and geopolitical events.
Prediction market analyst Dustin Gouker said many other congressional offices will likely follow Moulton’s lead. “I think everyone is very conscious of the potential for and optics around insider trading around government actions,” Gouker noted.
He acknowledged that getting to 100% clean markets is probably impossible but said better rules and surveillance can make it much more difficult. The scrutiny follows controversial bets on events like U.S. strikes on Iran and the capture of Venezuela’s Nicolás Maduro.
In response to the growing pressure, Polymarket and Kalshi have introduced stronger anti–insider trading measures. These include upgraded monitoring and surveillance capabilities alongside stricter internal policies.
