1. Congress Introduces Flurry of Bipartisan Prediction Market Bills
Between March 25 and March 26, members of both chambers introduced at least three bills targeting prediction markets. On March 25, Reps. Adrian Smith, R-Neb., and Nikki Budzinski, D-Ill., introduced the PREDICT Act, which would prohibit members of Congress, the President, and other senior officials from trading prediction market contracts. On March 26, Sens. Todd Young, R-Ind., Elissa Slotkin, D-Mich., John Curtis, R-Utah, and Adam Schiff, D-Calif., introduced the Public Integrity in Financial Prediction Markets Act of 2026, which would prohibit the President, Vice President, members of Congress, political appointees, and federal agency employees from using material nonpublic information to trade prediction market contracts on U.S. or foreign platforms. Also on March 26, Sen. Jeff Merkley, D-Ore., and Rep. Jamie Raskin, D-Md., introduced the STOP Corrupt Bets Act, which would ban event contracts related to elections, government actions, sporting events, and military operations. The full text of the Public Integrity in Financial Prediction Markets Act of 2026 is available here. Sen. Young’s press release is available here. The STOP Corrupt Bets Act press release from Sen. Merkley is available here. Rep. Raskin’s press release is available here.
2. California Governor Issues Executive Order Banning State Officials From Insider Prediction Market Trading
On March 27, California Gov. Gavin Newsom signed an executive order prohibiting all gubernatorial appointees from using confidential or nonpublic information obtained through their official roles to profit from prediction market contracts. The order took effect immediately. The executive order is the first state-level action specifically targeting prediction market insider trading by government officials, distinct from the state attorney general lawsuits challenging prediction market platforms’ legal authority to operate. The Governor’s announcement and executive order are available here.
3. Washington State Sues Prediction Market Platform Kalshi
On March 27, the Washington State Attorney General filed a civil complaint in King County Superior Court against Kalshi Inc., alleging the CFTC-regulated prediction market platform violated state gambling laws by operating without proper licensing. The complaint asserts that Kalshi’s event-based contracts constitute “gambling” under Washington law and that the platform’s advertisements referring to “legal betting” meet state definitions of bookmaking and professional gambling. Kalshi promptly filed to remove the case to federal court, citing CFTC exclusive jurisdiction over event contracts traded on designated contract markets. The action follows a temporary restraining order issued in Nevada on March 20 and criminal charges filed by the Arizona Attorney General earlier in March—the first criminal charges brought against a prediction market operator. The Washington Attorney General’s announcement is available here.
4. Nevada Court Grants Preliminary Injunction Against Coinbase Over Unlicensed Prediction Market Contracts
On March 26, the First Judicial District Court of Nevada granted the Nevada Gaming Control Board’s motion for a preliminary injunction against Coinbase Financial Markets Inc., prohibiting Coinbase from offering or facilitating sports-related, election-related, and entertainment-related event contracts within Nevada. The court found that the Gaming Control Board demonstrated a reasonable likelihood of success on the merits, concluding that Coinbase’s facilitation of event-based contracts through its partnership with KalshiEX LLC constitutes the operation of a “sports pool” and “percentage game” under Nevada law, without the required gaming licenses. On the critical question of federal preemption, the court held that “the balance of convincing legal authority weighs against federal preemption in this context.” The order is available here.
5. Australian Federal Court Orders Binance Australia Derivatives to Pay AU$10 Million Penalty for Client Misclassification
On March 27, the Federal Court of Australia ordered Oztures Trading Pty Ltd, trading as Binance Australia Derivatives, to pay AU$10 million after the exchange admitted to misclassifying more than 85 percent of its Australian client base over nine months, exposing 524 retail investors to high-risk crypto derivative products without required consumer protections. Binance admitted to onboarding failures, including allowing unlimited retakes of a qualification quiz and providing inadequate compliance oversight of client applications. The misclassified clients incurred more than AU$12 million in combined trading losses and fees. ASIC Chair Joe Longo stated that the case sends “a clear warning to global financial services entities looking to set up shop in Australia” that “[a]ll financial services companies must follow the law from day one.” ASIC’s media release is available here.
