Nine Democratic senators are urging the Commodity Futures Trading Commission to crack down on prediction markets that let users bet on wildfires, arguing the contracts create dangerous incentives to profit from natural disasters.
“Offering bets on destructive wildfires threatens to minimize communities’ suffering all so the rich and powerful can profit,” the Senators wrote. “There’s also the heightened risk—according to state and local fire officials—that individuals could be tempted to commit arson in order to make sure their bets are successful.”
“By offering contracts on fires, prediction market sites run the risk of encouraging people to influence fires that have already started, creating additional concerns around public safety and insider trading,” they wrote.
The senators argued the CFTC should rein in wildfire betting before the start of next year's wildfire season.
“While these bets appear to be offered only on the offshore Polymarket site, it is only a matter of time before other U.S. based Designated Contract Markets (DCMs) try to offer these,” the letter said. “The CFTC must lead the charge to rein in these contracts in the U.S. and offshore and put in place common-sense guardrails to prevent people from profiting as wildfires threaten communities.”
