Lawmakers Call For Ban on Gambling on U.S. elections

Five United States Senators and three House representatives are calling for a ban on betting markets tied to the upcoming 2024 presidential election.

The bipartisan coalition urged the Commodity Futures Trading Commission (CFTC) to finalize regulations to prevent these activities. The letter was signed by Senators Jeff Merkley, Richard Blumenthal, Chris Van Hollen, Elizabeth Warren, and Sheldon Whitehouse, along with Representatives Jamie Raskin, John Sarbanes, and Eleanor Holmes Norton.

The eight lawmakers, who are all members of the Democratic party, want the CFTC to prevent “Wall Street from setting up massive political betting markets that could interfere with elections.”

In their August 5 letter to CFTC Chair Rostin Behnam, the lawmakers expressed deep concerns about the potential for election betting markets to erode public trust in the democratic process.

“Allowing billionaires to wager extraordinary bets while simultaneously contributing to a specific candidate or party, and political insiders to bet on elections using non-public information, will further degrade public trust in the electoral process,” the lawmakers wrote.

They argue that allowing billionaires to place large bets on election outcomes could sway the results, fundamentally compromising the integrity of U.S. elections.

“Election gambling fundamentally cheapens the sanctity of our democratic process.

“Political bets change the motivations behind each vote, replacing political convictions with financial calculations,” the letter states, emphasizing the dangers of commodifying democracy.

One of the primary targets of their concerns is Polymarket, a decentralized prediction market platform that has seen a surge in activity as the 2024 election approaches. Polymarket allows users to bet on the outcomes of real-world events, including political races. It uses cryptocurrencies like USDC stablecoin, which allows users to buy and sell shares based on future event outcomes. The Polymarket blockchain-based platform recently hit a milestone, reaching $1 billion in monthly trading volume for the first time, with a significant portion of that activity tied to the upcoming presidential election.

The lawmakers argue that the existence of such markets could invite undue influence from wealthy individuals and political insiders, further degrading public confidence in the electoral process. They highlight the platform’s history of regulatory issues, including a substantial fine imposed by the CFTC in January 2022, as evidence of the need for stricter oversight.

The U.S. presidential election is scheduled on November 5, 2024, three months from now.

Read related article: Bitcoin, Blockchain, and Asia’s Gambling: Impacts and Future Trends