CALIFORNIA – U.S. Sen. Adam Schiff (D-Calif.) is introducing the DEATH BETS Act, which would prohibit Commodity Futures Trading Commission (CFTC)-registered entities from listing contracts tied to terrorism, assassination, war or an individual’s death.

The proposal comes amid growing scrutiny of prediction markets that allow users to wager on real-world geopolitical events.

Rep. Mike Levin (D-Calif.-49) will introduce companion legislation in the U.S. House.

Schiff’s bill follows prediction markets offering contracts tied to war and death. One market asked whether Iran’s Supreme Leader Ali Khamenei would be “out as Supreme Leader.” The contract drew about $54 million in trading on Kalshi before it was paused.

Kalshi is a federally regulated prediction market that allows users to trade contracts on the outcome of real-world events, such as elections or economic data.

Schiff said betting on war and death could allow insiders to profit from classified information, jeopardize national security and encourage violence.

“With regulators turning a blind eye, prediction markets have rapidly become the Wild West. As the CFTC seeks to rewrite the rules of the road, Congress must make clear that these death bets are unequivocally prohibited, and this bill would do just that,” said Schiff. 

Schiff has already raised concerns about “death contracts”

According to Schiff, the Commodity Exchange Act already allows the CFTC to bar contracts tied to war, terrorism or assassination if the agency determines they are contrary to the public interest.

Whether such contracts serve the public interest is up to the CFTC.

With CFTC Chair Michael Selig signaling plans to rewrite prediction market rules, Schiff said the agency should no longer have the discretion to decide whether such contracts are allowed.

The senator said he previously raised concerns in a letter to the CFTC signed by several other senators about so-called “death contracts” offered on offshore exchanges.

These included bets on whether the Artemis II mission would explode, whether Venezuelan President Nicolás Maduro would be removed from power, and whether Russian forces would capture the Ukrainian town of Myrnohad.

Ban on death contracts

Schiff’s bill would codify a ban on prediction contracts tied to war, assassination and terrorism. It would also explicitly prohibit contracts involving death or events closely linked to death.

Death-related contracts are not currently addressed in the Commodity Exchange Act.