Democrats in the U.S. Senate Called for Public Hearings on Prediction Markets

• All 11 Democrats on the Senate Banking Committee called for a public hearing on prediction markets.
• Lawmakers pointed to the risks of market manipulation and insider trading.
• The call came amid a closed-door meeting between Republicans and Kalshi CEO Tarek Mansour.

All 11 Democrats on the U.S. Senate Committee on Banking, Housing, and Urban Affairs urged Chairman Tim Scott to hold a public hearing on prediction markets. This was stated in the committee’s official release dated September 23, 2026.

The letter was led by the committee’s top Democrat, Elizabeth Warren, and Senator Catherine Cortez Masto. Other signatories included Jack Reed, Mark Warner, Chris Van Hollen, Tina Smith, Raphael Warnock, Andy Kim, Ruben Gallego, Lisa Blunt Rochester, and Angela Alsobrooks.

The senators said the committee needs to publicly examine the impact of prediction markets on consumers and the U.S. financial system. According to them, the segment of securities-related products is growing, and certain contracts tied to company performance metrics could potentially fall under the definition of security-based swaps and the oversight of the U.S. Securities and Exchange Commission (SEC).

The authors of the letter also cited experts’ concerns about market manipulation and insider trading. They urged that the issue be addressed on a bipartisan basis and that all committee members be given the opportunity to take part in the discussion.

“In the interest of transparency, we are requesting that the committee hold a public hearing on this important topic,” the letter said.

Notably, regulation of prediction markets in the U.S. remains a point of contention between federal authorities and individual states. In February 2026, the CFTC claimed “exclusive jurisdiction” over event contracts and entered into litigation with states that sought to restrict the operation of such platforms.

In April, a group of U.S. lawmakers separately called on the CFTC to step up oversight of potential insider trading in prediction markets.

In addition, in August, CME Group CEO Terry Duffy called for tighter regulation of this segment, pointing to the risk of manipulation of certain contracts.

Republicans Held a Closed-Door Meeting With Kalshi

Democrats’ demand came against the backdrop of a closed-door roundtable held by Republicans on the Senate Banking Committee with prediction market representatives.

On September 18, Punchbowl News reported, citing two sources familiar with the event’s preparations, that committee Republicans planned to hold a separate meeting on prediction markets tied to securities. Kalshi representatives were expected to attend.

On September 23, The Block reported that the meeting took place at 10:00 local time. Kalshi CEO Tarek Mansour attended.

Tim Scott confirmed to the outlet that the meeting took place. According to him, he brought together Senate Banking Committee Republicans and Kalshi representatives to discuss opportunities and challenges related to securities-based products. Participants touched on retail investor protection, the development of financial innovation in the US, and the regulation of new instruments.

The Senate Banking Committee oversees the SEC and can therefore review prediction market products tied to securities. At the same time, most of the sector falls under the jurisdiction of the Commodity Futures Trading Commission (CFTC), which is primarily overseen by the House and Senate agriculture committees.

In May 2026, the CFTC also loosened requirements for prediction markets and event contracts, issuing a related no-action letter. The regulator described the move as part of broader work on rules for the sector.

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