Rep. French Hill Introduces Prediction Market Act with Sen. Gillibrand

Prediction markets have surged in activity. Last year, they recorded about $51 billion in total transaction volume. This year, volume topped $60 billion in just three and a half months, with over 192 million unique transactions and more than 865,000 active users in March alone. Some estimates project growth to $1 trillion over the next several years.

With retail investors pouring in, the regulatory framework needs an update to safeguard participants, maintain market integrity, and position America as a leader in financial innovation.

Investors in prediction markets trade contracts linked to specific events. These contracts often beat polls and expert forecasts by harnessing collective knowledge. Businesses and individuals use them to manage risks, from inventory planning to portfolio hedging.

Contract prices provide real-time views of market expectations. Data from these markets has drawn attention from trusted news outlets.

Prediction markets are gaining traction among consumers, investors, companies, and financial institutions. Congress should recognize their value while ensuring clarity and protections for ordinary Americans.

Rep. French Hill, a House Republican, introduced the Prediction Market Act this week alongside Sen. Kirsten Gillibrand. The legislation seeks to deliver clarity and predictability to the sector through three principles.

First, it bolsters consumer protections. Prediction markets fall under Commodity Futures Trading Commission oversight, but current exchange rules do not fully address retail participants. The bill increases review of event contracts, raises investor standards for exchanges, and strengthens retail safeguards so users can participate confidently.

Second, it sets ethical limits to preserve public trust. Public officials cannot own event contracts tied to events they influence, preventing personal profit.

Third, it aims to keep America ahead in the industry. Unclear rules can drive innovation abroad, as Hill knows from his business experience. The bill promotes responsible growth for current and future retail investors.

Debates persist on issues like sports betting treatment as courts and regulators adapt. Still, prediction markets are established. Inaction risks consumer harm and offshoring of the industry.

The legislation lays groundwork for strong, safe, and fair U.S. markets.