US senators urge CFTC to curb wildfire prediction contracts

A group of U.S. senators is urging federal regulators to restrict or ban prediction market contracts tied to wildfires, arguing such bets could incentivize arson and profit from community destruction. The lawmakers, led by Senator Jeff Merkley of Oregon, sent a public letter to Commodity Futures Trading Commission Chairman Michael Selig on August 3, 2026, requesting the agency act as wildfires continue to burn across the Pacific Northwest.

The letter, signed by nine Democratic senators from Oregon, California, Nevada, Minnesota, and New Hampshire, asks the CFTC whether it is considering prohibiting designated contract markets from offering wildfire event contracts. The senators argue these contracts are against the public interest and create a perverse financial incentive. They cited public reporting that the offshore prediction market Polymarket generated more than $1.2 million in trading volume tied to the Palisades and Eaton fires that struck the Los Angeles area in January 2025. Contracts allowed bets on metrics such as when a fire would be contained, total acreage burned, and whether flames would reach specific locations like Beverly Hills.