US bill bans candidates betting on elections

U.S. Rep. Don Davis, a North Carolina Democrat, has introduced legislation that would bar federal candidates from trading prediction-market contracts tied to their own campaigns, extending the restriction to spouses, dependent children, and authorized campaign committees.

The No Betting on Your Own Race Act targets a narrow but increasingly visible conflict in political forecasting markets: candidates taking financial positions on events they can influence through campaign decisions, public statements, fundraising, endorsements, or even a decision to remain in a race. The bill would apply from the date of enactment and would use civil penalties rather than criminal charges.

Under the proposal, a candidate could not buy, sell, acquire, dispose of, hold, or otherwise maintain a direct or indirect financial interest in a “covered election contract” linked to that candidate’s own federal election. The prohibition would also cover a candidate’s authorized campaign committee, preventing campaigns from using prediction-market positions as an additional financial tool.

Bill covers outcomes beyond winning or losing

Davis’ bill is written to reach more than a straightforward wager on whether a candidate wins. Covered contracts would include markets based on whether a candidate remains in the race, receives a specified share of the vote, wins by a particular margin, or finishes in a certain place.

That scope would capture many of the contract types offered by political forecasting platforms, where users can trade outcomes tied to nomination contests, electoral college results, vote percentages, congressional control, and campaign developments. A candidate could have financial incentives around several of those outcomes even without betting directly on their victory.

The proposal also addresses indirect holdings. Its language treats an indirect interest as conduct in which a person causes, directs, requests, or induces another person to acquire, hold, sell, or dispose of a relevant contract. Knowingly providing funds for another person to take such a position would also fall within the restriction.

Those provisions are designed to prevent a candidate from simply moving activity to a relative, associate, or intermediary. They could also make campaign-linked arrangements harder to structure through third parties, since the bill focuses on control and financial involvement rather than only on the name attached to an account.

Civil fines would rise with financial gain

Violations would carry a civil penalty of $10,000 for each violation, or three times the net financial gain attributable to the violation, whichever amount is greater. The formula would limit the appeal of treating a modest fine as a cost of making a profitable trade.

The bill does not create a criminal offence. Its enforcement structure instead places the conduct within a civil penalty framework, reflecting the bill’s focus on preventing conflicts and discouraging financial exposure rather than prosecuting election-related wagering as a crime.

The proposed restrictions would begin when the legislation becomes law rather than retroactively applying to contracts held before enactment. Candidates and platforms would therefore need to assess open positions and account relationships once the effective date is known.

FEC list would support compliance

The legislation would require the Federal Election Commission to maintain a free, publicly available list of federal candidates and update it at least once each week. Candidates would also receive notice of the restrictions when they file to run for federal office.

A regularly updated FEC list could give prediction-market operators a more practical tool for identifying accounts associated with candidates covered by the ban. It could also help market participants identify contracts that might face compliance action if a trader connected to a candidate is found to hold a prohibited position.

The system would depend on more than checking a candidate’s own account. Because the bill covers spouses, dependent children, campaign committees, funding arrangements, and indirect interests, platforms would still face the more difficult task of detecting relationships that may not be visible from public candidate filings alone.

Political markets draw closer scrutiny

Davis introduced the measure as trading activity in political prediction markets has expanded. Pew Research Center reported that combined monthly trading volume on popular forecasting platforms reached $24 billion in April 2026, illustrating how these venues have moved beyond small communities of election enthusiasts.

Greater liquidity can make election contracts more useful as real-time indicators of market expectations, but it also raises the stakes when participants possess nonpublic campaign information or can affect the outcome being traded. A candidate deciding whether to withdraw, announcing a major endorsement, or altering campaign spending could move prices in contracts tied to their race.

The bill’s approach focuses on the participant with the clearest conflict: the person seeking the office. It does not propose a blanket ban on political prediction markets or on ordinary users trading election outcomes. Instead, it would place federal candidates and their immediate financial circle under rules resembling conflict-of-interest limits that already shape other areas of political and public-service conduct.

Measure joins a wider congressional debate

Davis’ proposal follows a separate bill introduced in June by Rep. Bryan Steil, a Wisconsin Republican. Steil’s legislation would restrict members of Congress, their spouses, and dependents from trading prediction contracts connected to certain government actions, policy decisions, or political outcomes.

The two measures address related risks from different directions. Steil’s bill is aimed at officeholders whose legislative or governmental actions could influence contract prices. Davis’ bill would reach candidates, including people who may not yet hold office but can still influence contracts tied to their own campaigns.

In April, prediction-market platform Kalshi penalized three U.S. congressional candidates for wagering on their own races and suspended each candidate from the platform for five years. Davis’ bill would place a federal legal restriction behind that type of platform policy, while adding statutory penalties and extending coverage to family members and campaign committees.

If the legislation advances, the central question for lawmakers will be whether candidate-specific restrictions can curb self-dealing without limiting the use of prediction markets by the public. Davis’ bill answers that question by drawing the line at financial positions connected to a candidate’s own path to office.