Merkley: Proposed CFTC rule falls short on curbing insider trading in prediction markets
Senator Merkley criticized a proposed CFTC rule on event contracts, arguing it fails to adequately crack down on insider trading and corruption on prediction markets. Arnold Ventures published commentary arguing that the proposed rules are insufficient for consumer protection. The organization referenced the Prediction Markets Are Gambling Act, bipartisan legislation sponsored by Senators John Curtis (R-UT) and Adam Schiff (D-CA), which would clarify that event contracts constitute gambling. The criticisms come amid broader debate over CFTC oversight of sports event contracts and enforcement actions against prediction market platforms.
Senator Merkley's critique joins Arnold Ventures' consumer-protection criticism to pressure the CFTC to tighten its proposed rule before the comment period closes. If the agency does not strengthen insider-trading safeguards, both Kalshi and Polymarket could face tougher congressional intervention through the Curtis-Schiff legislation.