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Baumgartner proposes banning wildfire prediction-market contracts

Regulation

US Representative Michael Baumgartner introduced legislation to bar federally regulated prediction markets from offering wildfire event contracts, reportedly amid concerns about incentives to start or worsen fires. Baumgartner said there was no evidence that a prediction-market trader had started a wildfire; the proposal follows a letter from nine Democratic senators urging the Commodity Futures Trading Commission to reject such contracts.

The proposal could restrict which event contracts federally regulated prediction markets may offer.

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Regulation

CFTC sues Utah over restrictions on prediction market contracts

The CFTC said it has sued Utah to prevent the state from restricting event contracts on CFTC-registered exchanges. The action follows Utah’s lawsuit accusing Kalshi of violating the state’s gambling prohibition; CFTC chairman Michael Selig said the agency was defending its authority over commodity derivatives.

On Tuesday the CFTC announced it had sued Utah, seeking to block the state from limiting the operations of exchanges registered with the agency. The agency's move answers a suit Utah brought against Kalshi, accusing the prediction markets platform of creating a public nuisance by evading the state's 130-year-old gambling ban.

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