In June, private predictions business Kalshi contacted the Commodity Futures Trading Commission (CFTC), saying it intends to offer election betting. Kalshi would offer event contracts on the outcome of elections in the US.
However, a number of senators have now contacted the CFTC to air their concerns. Writing in a joint letter, the senators said Kalshi’s plans would go against CFTC rules on the offering of certain event contracts.
The CFTC currently prohibits event contracts that “involve, relate to, or reference” gaming or activities unlawful under state laws. It also forbids activities similar to this if the CFTC determines the contract to be “contrary to the public interest”.
Senators say Kalshi’s plan opens the door to gambling on election outcomes and would be the first time the CFTC allowed a for-profit entity to offer event contracts on political events.
The group claimed the move would enable a large-scale, for-profit gambling market on which anyone can bet. It also said people could profit off political outcomes and interfere with elections.
This, the group added, would “erode” trust in the integrity of elections and potentially allow for interference in election outcomes.
Senators backing the letter include Chris van Hollen (Democrat – Maryland.) Jeff Merkley (Democrat – Oregon), Sheldon Whitehouse (Democrat – Rhode Island), Edward Markey (Democrat – Massachusetts), Elizabeth Warren (Democrat – Massachusetts) and Dianne Feinstein (Democrat – California).
Election betting could undermine voters
“There is no doubt that the mass commodification of our democratic process would raise widespread concerns about the integrity of our electoral process,” the letter said. “Such an outcome is in clear conflict with the public interest and would undermine confidence in our political process.
“Billionaires could expand their already outsized influence on politics by wagering extraordinary bets while simultaneously contributing to a specific candidate or party.
“There are strong ethics concerns as political insiders privy to non-public information could wield their inside information to profit at voters’ expense.”
The senators also spoke about the danger that election betting could sway the outcome. They said this could also undermine the voices of US voters.
“If citizens believe that the democratic process is being influenced by those with financial stakes, it may further exacerbate the disenfranchisement and distrust of voters already facing our nation,” the letter said.
“We urge the CFTC to deny Kalshi’s proposal.”
Original article: https://igamingbusiness.com/legal-compliance/legal/senators-integrity-election-betting/
