US Senators Adam Schiff (D-CA) and John Curtis (R-UT) have formally requested an investigation into the prediction market platform Polymarket, accusing it of deceptive marketing practices. In a letter dated June 26, 2026, the lawmakers called on Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam to examine whether the platform violated commodity trading laws by staging $1.9 million in fake bets as part of a promotional campaign.
The senators' demand follows a Wall Street Journal report alleging that content creators were paid to enter trades in a fabricated version of Polymarket to generate hype. The letter poses six pointed questions, including whether the CFTC has opened an investigation and if it possesses the authority and expertise to enforce consumer protections comparable to other financial regulators. A response was requested by July 10, 2026.
“The CFTC has repeatedly asserted regulatory authority over prediction markets and event contracts, yet with content creators routinely portraying prediction markets as ‘free money,’ there is little basis for treating them differently from gambling,” the senators wrote. They expressed concern that the regulator is not adequately enforcing existing laws and may be unable to shield consumers.
Polymarket, which allows users to trade on event outcomes using cryptocurrency, previously settled with the CFTC in 2022 for offering unregistered event-based binary options, agreeing to a $1.4 million penalty and a cease-and-desist. The platform operates on the Polygon blockchain and has faced growing scrutiny over its resemblance to gambling. A Polymarket representative told the WSJ the company will conduct a comprehensive audit of its promotional materials. Meanwhile, the CFTC is reportedly already conducting an “ongoing, extensive investigation” into Polymarket, though it is unclear if the focus includes advertising claims.
The bipartisan push signals heightened regulatory pressure on decentralized prediction markets, potentially paving the way for operational restrictions, stricter compliance requirements, or a precedent-setting enforcement action.
