{"database": "openregs", "table": "crs_reports", "rows": [["IF13239", "Prohibiting Senators from Prediction Market Participation", "2026-06-01T04:00:00Z", "2026-06-02T17:53:07Z", "Active", "Resources", "Jacob R. Straus, Jason O. Heflin", null, "In April 2026, the Senate agreed to S.Res. 708, as amended, to amend Senate rules to prohibit Senators, Senate officers, and Senate employees from participating in prediction markets\u2014exchange platforms that specialize in offering event contracts with a binary payoff structure tied to the occurrence or nonoccurrence of a specific event.\nThis In Focus provides background on the Senate prohibition on participation in prediction markets, related legislation, legal context, and considerations for Congress.\nAmendment to Senate Standing Rules\nOn April 30, 2026, the Senate agreed to S.Res. 708, as amended, to amend Rule XXXVII (Senate Rule 37) of the standing rules of the Senate and prohibit Senators, Senate officers, and Senate employees from participating in prediction markets. During debate on the resolution, the sponsor explained his reasoning for introducing the measure.\nEngaging in any way in a prediction market or trying to place bets where we might have insider information deteriorates the confidence our constituents have in us. So it is extremely important that the public know that from this day forward, there is no chance that any Member of Congress\u2014Member of the Senate in this case, in this resolution I am going to propose\u2014will be involved in any prediction market whatsoever. I am presenting a resolution that makes that crystal clear.\nBy changing the standing rules of the Senate, what we are doing is allowing our constituents to know once and for all that no Member of the U.S. Senate, no Member of the staff of the U.S. Senate can ever use that inside information as a way to monetize this job whatsoever.\n\u2014Senator Bernie Moreno, Congressional Record, \nApril 30, 2026 (p. S2151)\nSenate Rule 37 contains \u201cConflict of Interest\u201d provisions that govern outside employment restrictions, financial ethics, and other conflicts of interest. As amended, the new clause in Rule 37, as added by S.Res. 708, states:\nSection. 1. Prohibition on Prediction Market Trading by Senators\n...\n15. No Member, officer, or employee of the Senate may enter into, or offer to enter into, an agreement, contract, swap, or transaction that provides for any purchase, sale, payment, or delivery of an excluded commodity, as defined in section 1a of the Commodity Exchange Act (7 U.S.C. 1a), that is dependent on the occurrence, nonoccurrence, or the extent of the occurrence of a specific event or contingency. Nothing in this paragraph shall be construed to apply to insurance for which the insured holds a lawful insurable interest.\nAdditionally, S.Res. 708 contains a \u201cSense of the Senate\u201d provision that the \u201cHouse of Representatives, executive branch, and judicial branch should establish restrictions similar to those\u201d adopted by the Senate.\nFollowing adoption of S.Res. 708, the Senate Select Committee on Ethics issued a Dear Colleague letter to provide guidance on prediction markets. The Dear Colleague letter described prediction markets as \u201cexchange platforms specializing in event contracts. Event contracts refer to contracts with a binary payoff structure based on the occurrence or nonoccurrence of an event. Users buy and sell these event contracts, continually updating the established price.\u201d The letter reiterated that the prohibition extends to activity \u201cconditioned on the occurrence, nonoccurrence, or extent of an occurrence of a specific event.\u201d For more information, see CRS In Focus IF13187, Prediction Markets: Policy Issues for Congress, by Karl E. Schneider and Rena S. Miller (2026); and CRS Legal Sidebar LSB11406, Prediction Markets and Insider Trading Law, by Jay B. Sykes (2026).\nSenate Select Committee on Ethics Implementation of Prediction Market Prohibition\nThe Senate Select Committee on Ethics\u2019 Dear Colleague letter included guidance and frequently asked questions (FAQ) for the implementation of S.Res. 708. The letter provided background information on prediction markets and noted the laws restricting the use of material nonpublic information. The FAQ explained that S.Res. 708\ndoes not apply to spouses and dependent children of covered individuals; \ndoes not apply to commodity futures trading in agricultural products or exempt commodities, but does apply to excluded \u201ccommodities conditioned on the occurrence or nonoccurrence, or extent of an occurrence of a specific event\u201d;\ndoes not apply to legalized sports gambling in jurisdictions that permit sports wagering; and\nis effective immediately and covered individuals are required to divest positions and could be required to file a periodic transaction report (PTR).\nOther Proposed Legislation\nIn addition to the Senate\u2019s adoption of S.Res. 708, proposals have been introduced to limit Members\u2019 (and others\u2019) participation in prediction markets. In the 119th Congress, two House resolutions\u2014H.Res. 1248 and H.Res. 1263\u2014propose to restrict House Members, House officers, and House employees from participation in prediction markets, similar to S.Res. 708. Both House resolutions also propose an exemption for insurance contracts similar to the exemption found in the Senate prohibition. H.Res. 1248 also includes an exemption for lawful sports wagers.\nSeveral measures have been introduced that propose to amend the Ethics in Government Act (H.R. 8076; S. 4188), amend the Commodity Exchange Act (S. 4017), or create new law (H.R. 7004) to prohibit Members of Congress and other covered individuals from participation in prediction markets. For analysis of prediction market legislation, see CRS In Focus IF13207, Prediction Markets Legislation in the 119th Congress, by Karl E. Schneider and Alexander H. Pepper (2026).\nLegal Context\nMeasures like S.Res. 708 exercise authority granted Congress under Article I, Section 5, Clause 2 of the Constitution, which gives each chamber authority to determine the rules of its proceedings and to punish its Members. \nIn addition to chamber rules, Members and congressional staff participating in prediction markets are subject to requirements under certain government ethics statutes. These include the Ethics in Government Act and the Stop Trading on Congressional Knowledge (STOCK) Act, which may require annual and/or periodic disclosure of transactions on prediction markets. For more information on disclosure requirements, see CRS Report R47320, Financial Disclosure in the U.S. Government: Frequently Asked Questions, by Jacob R. Straus (2023).\nNo federal law prohibits Members or congressional staff from trading on prediction markets. The primary federal conflict of interest statute, 18 U.S.C. \u00a7208, does not apply to Members or congressional staff. However, Members and congressional staff trading on prediction markets using confidential information gained in the course of their government service are subject to other limitations under federal law. Some prediction markets have registered with the Commodity Futures Trading Commission (CFTC), and the CFTC has treated contracts traded on these markets as options and swaps. The Commodity Exchange Act (CEA) prohibits the use of \u201cany manipulative or deceptive device or contrivance, in contravention of such rules and regulations as [CFTC] shall promulgate.\u201d CFTC has used a rule implementing this provision, Rule 180.1, to pursue persons making trades in commodities and derivatives markets based on material, nonpublic information in breach of a duty to the source of the information. \nIn addition to this generally applicable prohibition, Members and congressional staff are also subject to certain explicit prohibitions. The CEA, as amended by the STOCK Act, prohibits Members and employees of Congress from using nonpublic \u201cinformation that may affect or tend to affect the price of any commodity in interstate commerce, or for future delivery, or any swap\u201d to enter into a futures contract, option, or swap for personal gain. Members and congressional staff are also prohibited from providing such information to a third party with intent to assist that person to enter into such transactions. \nThese prohibitions also apply to other employees or agents of the federal government. CFTC has recently taken action against an active-duty servicemember in the U.S. Army for violating these prohibitions and Rule 180.1 by allegedly using nonpublic information to trade on a prediction market. The U.S. Attorney\u2019s Office for the Southern District of New York has also brought criminal charges arising from the same conduct.\nConsiderations for Congress\nCongress could decide to take no further action in relation to the participation of government officials in prediction markets. Should Congress decide to legislate further, several options might exist. These could include a prohibition similar to S.Res. 708, a limitation on participation in categories of prediction market contracts related to congressional or governmental actions, or the inclusion of prediction markets in other measures limiting financial activities.\nIn that context, the House could pass a resolution to amend House Rules to prohibit House Members, House officers, and/or House employees from engaging in prediction markets. Amending House Rules would likely create a parallel requirement in House and Senate Rules against participation in prediction markets.\nThe House and Senate could enact legislation to statutorily prohibit Members, House and Senate officers, House and Senate employees, or other covered officials from participating in prediction markets.\nCongress could enact legislation to cover a broader group of government officials and employees. For further discussion of legislative proposal in the 119th Congress that would limit or prohibit participation in prediction markets, see CRS Report R48641, Proposals to Limit Member of Congress Financial Activities: Analysis of Introduced Legislation in the 119th Congress, by Jacob R. Straus (2026).", "https://www.congress.gov/crs_external_products/IF/PDF/IF13239/IF13239.1.pdf", "https://www.congress.gov/crs_external_products/IF/HTML/IF13239.html"]], "columns": ["id", "title", "publish_date", "update_date", "status", "content_type", "authors", "topics", "summary", "pdf_url", "html_url"], "primary_keys": ["id"], "primary_key_values": ["IF13239"], "units": {}, "query_ms": 0.23790700652170926, "source": "Federal Register API & Regulations.gov API", "source_url": "https://www.federalregister.gov/developers/api/v1", "license": "Public Domain (U.S. Government data)", "license_url": "https://www.regulations.gov/faq"}