Summary
- Rep. Don Davis (D-NC) has put forward a bill that prohibits federal candidates from trading contracts related to their own elections.
- Violating this ban would result in a civil penalty of $10,000 or three times the profit gained, whichever is greater.
- Trading platforms would receive immunity for actions taken to close accounts or report violations.
A new bill introduced in the House by Representative Don Davis (D-NC) aims to prevent federal candidates, along with their spouses and campaign committees, from trading prediction market contracts associated with their own elections.
The No Betting on Your Own Race Act seeks to amend federal election laws, categorizing such trades as civil offenses that incur a $10,000 penalty for each violation, or three times the financial gain from the trade, whichever is higher.
"We don't want our athletes to bet on their games. Candidates running for federal elected office should be treated exactly the same and should not be allowed to trade on their own election.
Candidates from different political parties have traded on their own races, and Congress… pic.twitter.com/gBDC8h4Tki
— Congressman Don Davis (@RepDonDavis) October 5, 2026
Davis emphasized on Twitter, "We don't want our athletes to bet on their games. Candidates from different political parties have traded on their own races, and Congress must bring an end to it."
The proposed ban is comprehensive, applying to candidates, their spouses, dependent children, and any authorized committees. It covers contracts that determine not just the winner of a race, but also whether a candidate continues to run, as well as their vote share, margin, or placement. It also includes indirect actions, such as encouraging others to trade, having a beneficial interest in trades, or funding someone else's trades while aware of their purpose.
The legislation primarily targets trading platforms rather than the candidates themselves. These platforms and their employees would not face penalties for good faith efforts to prevent violations, including actions like closing accounts or cancelling trades. They would also be able to report suspected violations to the Commodity Futures Trading Commission (CFTC), the attorney general, or the Federal Election Commission without incurring liability and without notifying the individual reported.
Myriad: Who will control Congress after the Midterms? Click to make your prediction.To facilitate compliance, the Federal Election Commission (FEC) would need to maintain a publicly available, machine-readable list of all federal candidates, updated at least weekly. This list would include each candidate's name, commission identifier, the office they are seeking, and the dates they entered and exited the race. Additionally, both the FEC and state election boards would be required to inform candidates of the new rules at the time they file.
A grace period is included, allowing individuals to hold or sell positions that become subject to this law when they declare their candidacy, as long as this occurs within the minimum divestment window established by the platform.
The bill's definition of a political event contract extends beyond elections, encompassing caucuses, nominations, control of Congress, and any other political or governmental events designated by the CFTC. The ban would take effect upon the bill's enactment.
Thus far, trading exchanges have largely self-regulated this issue. Earlier this year, Kalshi fined several congressional candidates for betting on their own races and has since suspended additional candidates. The CFTC is also investigating former Representative Adam Kinzinger for trades related to his own presidential pardon. Furthermore, last month the agency cautioned exchanges that contracts linked to the actions of named individuals should be viewed as susceptible to manipulation.