Six Democratic U.S. Senators urge CFTC to impose an outright ban on prediction-market contracts tied to deaths

Six Democratic U.S. senators urged the Commodity Futures Trading Commission (CFTC) to explicitly ban prediction-market contracts linked to an individual’s death or physical harm.

According to CNBC on the 24th, Democratic senators Adam Schiff, Richard Blumenthal, Cory Booker, Tim Kaine, Catherine Cortez Masto and Jacky Rosen wrote to CFTC Chair Michael Selig, saying that “contracts that incentivize bodily harm or death pose dangerous national security risks.”

The lawmakers demanded that the CFTC “clearly reaffirm” that it will categorically prohibit any contracts that directly concern, or are closely tied to, a specific person’s death. They also noted that under current federal commodity rules, contracts that include or reference terrorism, assassination, war and the like are already prohibited.

The letter was sent as prediction markets such as Polymarket and Kalshi grow rapidly. The senators voiced concern that such markets could encourage trading based on inside information or profit-making from human suffering.

The letter took issue with three recent examples presented on Polymarket. One was a contract on the possibility of a failed launch of NASA’s Artemis II, which the senators argued could be directly linked to crew deaths and could incentivize mission failure. Polymarket responded that the market concerned the possibility of a booster-stage malfunction, not crew safety.

Another example was a contract over whether Venezuelan President Nicolás Maduro would be ousted. The senators cited media reports that a particular trader made a large profit using advance information, arguing that internal controls and oversight were inadequate.

A contract addressing whether territory would be occupied in connection with the war in Ukraine was also cited as a case directly linked to war. The senators warned that such contracts could create economic incentives tied to real-world instability or violence.

Meanwhile, the CFTC recently argued in a filing submitted to a federal appeals court that it has exclusive jurisdiction over the U.S. commodity derivatives market. Chair Selig has criticized some state governments’ regulatory efforts in an opinion piece for The Wall Street Journal.

The CFTC did not immediately comment on the letter.