US senators introduce bipartisan bill to regulate prediction markets and event contracts

Two US senators introduced a bipartisan Prediction Market Act of 2026. The bill sets clearer rules for event contracts and adds retail safeguards.

The sponsors are Dave McCormick and Kirsten Gillibrand. Their press release outlines the changes.

The act defines key terms. “Event contract,” “public interest,” and more. This aims to cut ambiguity.

Contracts tied to enumerated activities get extra review. Violence is listed. The CFTC would apply a public-interest test to each.

Exchange standards tighten. Enhanced certification is required. Disclosures must be simpler for retail users.

Operational rules expand. Advertising controls and KYC come in. Exchanges like Polymarket and Kalshi would need added safeguards for customer funds.

Key institutional pieces:
- Ban on event-contract ownership by lawmakers and senior officials source
- New CFTC Office of the Retail Advocate source
- Advisory Council on Consumer Protection source
- Innovation Advisory Committee for tech–finance policy source

The CFTC must study market developments. It must report findings to Congress to keep oversight current source.