Following intense criticism from lawmakers, Polymarket has taken down a market that allowed users to bet on the rescue of US service members in Iran. The market, which was tied to the rescue of two airmen after an F-15E fighter jet was shot down over Iran, sparked outrage and was subsequently removed after being deemed to not meet the company's integrity standards. Representative Seth Moulton, a Democrat from Massachusetts, was among those who criticized the listing, calling it 'disgusting' and arguing that it reduced a military rescue effort to a financial trade. This incident comes as prediction markets face increasing regulatory pressure, with a group of congressional Democrats introducing legislation to ban contracts tied to elections, war, and government actions.
The Commodity Futures Trading Commission has also filed lawsuits against three states over efforts to bypass federal oversight of prediction markets. Meanwhile, the industry is expanding, with Kalshi securing a license to offer margin trading to institutional investors and new players, including JPMorgan, entering the market.