Democratic Lawmakers Push for Ban on Election Gambling
A group of Democratic lawmakers, led by Sen. Jeff Merkley and Sen. Elizabeth Warren, are urging the Commodity Futures Trading Commission (CFTC) to finalize a rule that would prohibit gambling in U.S. elections. The goal of this campaign is to safeguard the integrity of the election process and rebuild public confidence.
Ban Finalized: Upholding Election Integrity
In a letter dated Aug. 5 addressed to CFTC Chairman Rosten Benham, lawmakers expressed their concerns about the influence of Wall Street on election outcomes. They argue that permitting large political betting markets could disrupt elections and further diminish trust in the democratic system.
“As the 2024 presidential election approaches, voters are already faced with a political system that allows the wealthiest individuals and corporations to funnel dark money into elections without disclosing it. The threat of violence and extremism is high, and the United States remains a target for foreign actors seeking to interfere with the election,” the lawmakers wrote.
The lawmakers emphasized the dangers of electoral gambling, asserting that it undermines the sanctity of the democratic process. They believe that turning elections into a betting game shifts the focus from political beliefs to financial gain, eroding trust in the electoral process.
“Allowing billionaires to place massive bets while contributing to specific candidates or parties, and political insiders using non-public information to bet on elections, will further damage public trust in the election process,” they added.
Supporting the Proposed Rules
The letter also supports the CFTC’s proposed rules, noting that political primaries being treated as a game and being contrary to the public interest. Lawmakers argued that betting on political events did not serve the economic purpose of the futures market and that regulating elections and campaigns falls outside the CFTC’s jurisdiction. Furthermore, many states already prohibit election betting, and introducing such bets at the federal level could infringe on state responsibilities.
Senator Merkley had previously urged the U.S. Commodity Futures Trading Commission to reject a proposal by private prediction market operators to legalize gambling on U.S. elections. Despite this, the CFTC ultimately did not approve the proposal.
Impact on Prediction Markets
Although the letter did not name any specific platform, prediction market Polymarkets has seen a significant increase in trading volumes. Data from the Dune dashboard shows that Polymarket’s monthly trading volume reached $387.03 million in July, driven by heightened anticipation and discussions surrounding the upcoming U.S. presidential election in November.
