House Oversight Staff Urge Limits on Officials’ Prediction Market Trades

Federal employees, lawmakers and congressional aides could face limits on bets tied to government decisions or political contests, even when they do not use confidential information, under a proposal staff urged Congress to consider.

The Nov. 13 staff memorandum is a recommendation, not an enacted restriction. Staff proposed limiting those categories of contracts at a minimum and presented a broader ban on officials’ prediction market trading as an option. They also recommended information sharing between platforms and regulators to help enforce restrictions. Each event contract resolves to either a yes or a no.

The committee opened its inquiry May 22 with Kalshi and Polymarket, then expanded it Sept. 29 to Hyperliquid Labs, Crypto.com and Aristotle Exchange, Inc., which operates PredictIt. The expanded platform inquiry gathered nearly 1,700 pages of documents and communications and included five bipartisan briefings with platform representatives.

Prediction-market contracts fall within existing federal insider-trading rules, which bar covered officials from trading certain derivatives with nonpublic information acquired through their government roles. The proposed limits would cover some contracts even when traders did not use inside information.

Four platforms provided extensive information on their controls, and platform operators initially identified most of the incidents they reported. Polymarket has a surveillance system called PolyGraph, developed with Chainalysis, and hired a former law enforcement expert.

A federal indictment alleges Army Master Sergeant Gannon Ken Van Dyke used classified information about the operation to capture Nicolás Maduro to trade on Polymarket. It alleges he made about 13 trades from Dec. 27, 2025, through Jan. 2, 2026, and profited approximately $409,881. The allegations have not been proven in court.

House Oversight Committee Chairman James Comer said, “Congress must consider additional reforms to prevent public corruption and restore the American people’s trust in government.” The recommendations would require congressional action to become restrictions.