Crypto prediction platform Polymarket and derivatives exchange Kalshi were closing in on $20 billion valuations when the US Congress decided it had seen enough.
A Bill Targeting Crypto And A Very Long AcronymThe bill doesn’t stop at US borders. Because many of these contracts trade on offshore crypto platforms, the legislation would extend federal gambling laws to reach international operators.
Payment processors would be required to cut off money flows to prohibited platforms. US-based individuals who run or promote these businesses could face criminal penalties.
Any registered commodity exchange listing these types of contracts would also be barred from doing so.
The law would take effect 30 days after being signed.
Suspicious Trades That Caught Washington’s AttentionMurphy argued this creates a dangerous setup: when people connected to government decisions can profit anonymously from bets placed before those decisions go public, the line between governing and gambling disappears.
The concern isn’t just corruption. It’s that decision-makers could develop a financial interest in pushing policy toward specific outcomes.
In January, Rep. Ritchie Torres of New York introduced a bill barring federal officials from betting on markets tied to government decisions — a direct response to a trader who turned $30,000 into more than $400,000 betting on Maduro’s capture before it happened.
That bill came after $529 million in Iran-related trades hit Polymarket in a single stretch.
Featured image from Thomas Fuller/SOPA Images/LightRocket via Getty Images, chart from TradingView
