Congress steps up scrutiny of election betting as prediction markets grow

U.S. lawmakers from both parties are pushing bills to tighten oversight of prediction markets tied to elections, wars and other political events, prompting the CFTC to outline a new regulatory framework focused on insider trading and market manipulation. Kalshi and Polymarket have faced penalties or investigations linked to users spreading election-fraud claims and to allegations that politicians placed improper bets. The developments center on how derivatives regulation could evolve, without specific traditional financial assets being singled out or directly affected.