Baumgartner introduces federal ban on wildfire event contracts
Baumgartner introduced federal legislation to ban betting on wildfires through event contracts on federally registered prediction-market platforms, including Polymarket and Kalshi. In announcing the bill, Baumgartner noted no evidence links alleged Spokane County arson to prediction markets. The legislation targets contracts tied to natural disasters. The proposal arrives as wildfire contracts face mounting political pressure from lawmakers and regulators.
Wildfire contracts are prediction markets' most politically exposed product, and Nevada senators are already pushing the CFTC for a parallel ban. Kalshi and Polymarket, Baumgartner's federal bill collapses the preemption defense entirely: a congressional statute overrides any CFTC registration claim. Traders active in these markets risk voiding if federal law lands mid-contract, not merely state injunction. The annual return of wildfire season means this pressure recurs each summer, making the product permanently seasonal in political risk.
The first platform to suspend under pressure will set the default response for competitors. Polymarket's CFTC-regulated status offers no shield if Congress writes a product-specific ban. Legal teams now must model a three-front threat: federal statute, CFTC rulemaking, and state enforcement. The bill's timing, amid active wildfires and state court losses, maximizes its odds of swift co-sponsorship. Traders and market makers should treat wildfire contracts as hearing a legislative countdown that state actions alone did not impose.
Congressman Baumgartner's federal ban joins Nevada senators' CFTC push against wildfire contracts, as Washington courts and state attorneys general in New York and elsewhere already target Kalshi's state operations.