U.S. Congressman Proposes Legislation to Ban Insider Trading in Prediction Markets

U.S. Congressman Ritchie Torres will introduce the "2026 Financial Prediction Market Public Integrity Act," which prohibits federal officials from trading in prediction markets using significant non-public information. This move stems from a controversial incident: a Polymarket account created last December placed approximately $32,500 in bets solely on the situation in Venezuela, profiting over $400,000 within 24 hours after Maduro was arrested by U.S. forces, with a return of over 1200%.

The account made only 4 predictions, all related to U.S. intervention in Venezuela, and the market began to rise hours before Trump's announcement, raising suspicions of insider trading. The bill will extend the principles of the STOCK Act to prediction markets, which had a trading volume exceeding $44 billion in 2025.