Following intense criticism, Polymarket has taken down a market allowing users to bet on the rescue of US service members in Iran. The market, which was available after an F-15E fighter jet was shot down over Iran, sparked outrage among lawmakers, including Rep. Seth Moulton, who deemed it 'disgusting' for reducing a military rescue effort to a financial wager. Moulton has been a vocal critic of prediction markets, having recently prohibited his staff from using platforms like Polymarket and Kalshi due to concerns over potential policy influence.
A Polymarket spokesperson stated that the listing failed to meet the company's integrity standards and was removed shortly after its appearance, prompting a review of internal safeguards. This incident occurs amid growing regulatory pressure on prediction markets in Washington, with congressional Democrats introducing legislation to ban contracts tied to elections, war, and government actions.
Furthermore, senators have urged the Commodity Futures Trading Commission to prohibit markets linked to individual deaths, citing national security concerns. The CFTC has also filed lawsuits against three states for attempting to bypass federal oversight of prediction markets.
The industry is facing scrutiny beyond politics, with the NFL requesting operators to avoid offering contracts that could be deemed objectionable or manipulable. Despite this, the market continues to expand, with Kalshi securing a license for margin trading to institutional investors and new players, including JPMorgan, entering the market.