Senator Adam Schiff (D-CA) has introduced a bill that would ban prediction market contracts linked to terrorism, war, murder and death, directly challenging market regulator CFTC’s shift toward looser regulation of event trading.
The bill, called the DEATH BET Act, would strip the agency of discretion over whether to allow such contracts and sign explicit prohibitions into law, putting Schiff on a collision course with CFTC Chairman Mike Selig’s deregulatory agenda.
Schiff, a member of the Senate Agriculture Committee that oversees the CFTC, is in a position to put legislative pressure on the issue as the agency’s new rulemaking takes shape.
Under the Commodity Exchange Act, the CFTC already has the authority to block contracts linked to war, terrorism or murder if it determines they are contrary to the public interest. But enforcement of the law depends on the regulator’s discretion, meaning the scope of protection changes with the agency’s leadership.
Schiff’s bill would eliminate that flexibility. It would prohibit any exchange registered with the CFTC from listing contracts that involve, relate to, or reference terrorism, murder, war, or the death of an individual. The ban extends to contracts that could “be construed as closely correlated” with a person’s death, a remarkably broad standard.
“Betting on war and death creates an environment in which insiders can profit from classified information, our national security is endangered, and violence is encouraged,” Schiff said in a statement. “There is no justification for betting on lives, nor for obtaining public benefits from such a market.”
Rep. Mike Levin (D-CA) will introduce companion legislation in the U.S. House of Representatives, according to a statement from Schiff’s office.
The proposal comes as the CFTC, under Selig, rewrites its approach to regulating prediction markets.
In February, the agency withdrew a proposal by 2024 that would have broadly banned political prediction markets, and Selig criticized the earlier effort as regulatory overreach.
