As the U.S. military prepared to strike Venezuela early Saturday morning, an anonymous user on the online prediction platform Polymarket wagered $32,000 that President Nicolás Maduro would be “out by January 31st.”
Hours later, Maduro and his wife were captured in a U.S. military raid and scuttled to New York — netting the user more than $400,000 in profit.
“The term prediction is actually a misnomer because if you’re the one making the decision, or if you’re part of the decision-making process, you’re not predicting anything. You’re governing for profit,” Democratic Bronx Rep. Ritchie Torres said.
The user’s profile raised red flags for Torres. They joined the platform in December and used it exclusively for bets regarding U.S. military action in Venezuela.
“Even though the identity of the trader remains unknown, the possibility that it could have been a government insider is reason enough for Congress to legislate,” Torres said.
On Friday, Torres introduced legislation to bar federal officials and employees, including congressional members and staffers, from making bets on online prediction platforms on matters they may possess, or reasonably obtain non-public information on. Torres argues such regulation is necessary, despite existing insider trading laws, because he views the growing gambling platforms as a legal grey space.
“Prediction markets are new and therefore unregulated, and I have a simple argument. We should hold prediction markets to the same standard [to] which we hold every other market,” he explained.
As of Friday afternoon, 30 lawmakers had signed onto the bill, including Reps. Dan Goldman, George Latimer and Josh Riley.
“It’s really not that complicated: public service should be about serving the public. No one in Congress should be able to use insider information to get rich,” Riley, whose district stretches from Ithaca to the Massachusetts border, told Spectrum News. “If you’re both a government insider and a participant in the prediction market, you now have a perverse incentive to push for policies that will line your pockets.”
Next week, Torres plans to introduce separate additional legislation pertaining to the U.S. strike in Venezuela. If passed, it would bar the president from leveraging an indictment to bypass required congressional authorization for military action.