WASHINGTON — Prediction market websites allow betting on everything from foreign affairs to election results to the weather.
Rep. James Comer, R-Tompkinsville, said the committee he leads on Capitol Hill is investigating whether some bettors are using nonpublic information to make wagers in prediction markets.
Comer sent letters to Polymarket and Kalshi, which both ban insider trading, requesting documents on how each platform “implements identity verification for domestic and international account holders, enforces geographic restrictions, and detects anomalous trading activity to prevent insider trading across its global platform.”
In the letters, he refers to charges against a U.S. special forces soldier accused of using classified information related to the raid capturing Venezuelan President Nicolás Maduro to place wagers for personal profit.
Comer told CNBC’s ‘Squawk Box’ Friday that the markets are the “Wild West.”
“There’s a concern now that members of Congress, members of the president’s administration, any type of government employee, could use basic insider knowledge and make huge profits on anything government-related, so we want to not only to launch an investigation to see how widespread this has been thus far, but also to prove a case that we’ve got to pass some type of legislation,” Comer said.
Some lawmakers have introduced legislation that would ban wagering on government actions and war and other events where someone could know or control the outcome.