Congress is taking a closer look at the rapid rise of prediction markets — online platforms where users bet on the outcome of future events, including elections, economic shifts, and even military operations.
What once seemed like a niche form of digital wagering has now become a growing concern in Washington.
Unlike traditional sports betting, prediction markets allow people to place money on major global developments such as whether oil prices will rise, how political races will end, or when a war might conclude. Supporters say these platforms reflect public sentiment and forecast outcomes. Critics argue that they can incentivize the misuse of non-public information.
That concern intensified following a high-profile case involving a U.S. Special Forces soldier accused of profiting from inside information tied to a military operation. Authorities say Master Sgt. Gannon Ken Van Dyke placed bets on Polymarket just hours before the reported capture of Venezuelan President Nicolás Maduro and later made roughly $400,000. He now faces charges including theft of government information and commodities fraud.
The case has become a flashpoint in Congress.
During a recent exchange, Sen. Elizabeth Warren pressed Defense Secretary Pete Hegseth over suspicious trading activity connected to wartime information.
“It looks like insiders have been making out like bandits,” Warren said, asking whether the timing of certain trades could be explained by anything other than insider trading.
Hegseth responded that the department’s handling of information had been “completely above board.”
In response, lawmakers are now pursuing tougher restrictions. Proposed measures would bar military personnel and Pentagon civilian employees from using prediction markets to bet on global events. Congress is also looking to apply similar rules to members of Congress and their staffs.
Still, the issue is politically complicated.
President Trump has voiced support for prediction markets, even as some Republicans and Democrats push for tighter oversight or outright bans. Maryland Gov. Wes Moore criticized the idea of allowing insider-informed betting on military operations, saying public servants should never be able to profit from privileged information. He also pointed to his own move to ban state employees from using insider information on prediction markets.
Gov. Moore said, “Listen, it’s crazy that people can use insider information to bet on things like military operations. That’s why I was the first governor in the country to ban state employees from using insider information to profit on prediction markets.”
Some states are already acting. Minnesota lawmakers have banned prediction markets altogether.
Beyond the legal and political debate, some faith leaders and ethics advocates warn that prediction markets raise deeper moral questions.
Dr. RaShan Frost of the Ethics & Religious Liberty Commission argues that these platforms can degrade human lives and suffering by turning them into financial instruments. “It reduces human beings to being commodities,” Frost said. “Somebody’s making money off the calamity of others.”
Frost also linked gambling expansion more broadly to social harms, including financial devastation, family breakdown, violence, and mental health crises.
He says this is an issue that cuts across ideological lines. “People on the hard right and the hard left both see this as being problematic,” Frost said.
As debate grows in Washington, lawmakers are weighing whether prediction markets are simply a new form of forecasting — or a dangerous system that rewards insider access, undermines trust, and puts the public interest at risk.
