Under a new bill filed in Congress, prediction markets would be banned from offering contracts on wildfires.
This may be a solution in search of a problem, as it would appear no prediction markets are actually offering contracts on wildfires. The last time this happened appears to be back in January of 2025, when Polymarket offered contracts on the containment of the Palisades fire in California.
Still, this isn’t coming out of nowhere. Earlier this month, a handful of senators sent a letter urging the Commodity Futures Trading Commission (CFTC) to block wildfire bets outright, citing the $1.2 million Polymarket took on last year’s California fires.
The bill, introduced Monday by Republican Rep. Michael Baumgartner of Washington, is seeking to make that letter a reality. The legislation has been referred to both the House Committee on Agriculture and the Committee on the Judiciary.
The bill itself casts a wide net by effectively banning all contracts tied to anything involving a wildfire, including when one starts, where it happens, how long it lasts, how big it gets, how fast it spreads, and when it gets contained. Contracts involving evacuations, injuries, deaths, or property damage would also be banned.
The bill says wildfire contracts create a financial incentive for people to profit from fires, and further problems arise if someone has inside information about evacuations, containment efforts, or other parts of the response. It also says federally regulated markets should not allow people to gamble on the destruction of homes, businesses, natural resources, or communities.
Review of laws
In addition to banning the markets, the bill requires the U.S. attorney general, along with the CFTC, Department of Agriculture, Department of the Interior, and other federal agencies, to review existing laws involving people who try to profit from wildfires through prediction markets or other wagers. That review would have to be finished within 180 days of the bill becoming law.
One of the things the review would look at is what laws would apply if someone intentionally started a wildfire in an effort to make money on a prediction market.
The review would also look at offshore prediction markets, digital assets, and other ways people could place wildfire-related wagers outside the normal U.S. regulatory system.
And if current laws are not enough, the bill asks the government to consider whether stronger penalties, more reporting requirements, or other new laws are needed. The attorney general would then have to send Congress a report with the findings and any recommendations.
