US senators urge crackdown on wildfire betting amid warnings of arson risk

A group of US lawmakers is sounding the alarm over prediction market platforms that allow users to bet on wildfires, as experts warn the emerging trend could raise the risk of Arson.Democratic senators from six states sent a letter this week to the chair of the Commodity Futures Trading Commission (CFTC), an independent government agency regulating platforms such as Polymarket and Kalshi, urging it to rein in the practice.“As the United States faces yet another record-breaking fire season this year, the Commodity Futures Trading Commission (CFTC) cannot allow these prediction markets to offer unrestricted betting on wildfires,” said the lawmakers, who included Oregon senator Jeff Merkley, California senators Adam Schiff and Alex Padilla, and Catherine Cortez Masto of Nevada. They said such bets pose a risk that “individuals could be tempted to commit Arson in order to make sure their bets are successful”.Recent reporting has shed light on a growing market for betting on wildfires.As the Palisades and Eaton fires devastated Los Angeles in early 2025, the prediction site Polymarket gave users the chance to bet on questions such as when the wildfires would be contained, whether flames would spread to certain neighborhoods by a particular date, and how many acres of land would burn. The amounts waged on the LA fires totalled more than $1.2m, according to Jamie L Pietruska, a historian at Rutgers University who followed those predictions. And this summer, a site called Wyldfyre, purported to be the “first prediction market for California wildfire” exclusively, has offered trades on “what fire does next”.Lawmakers’ concerns come as the US faces another brutal wildfire season. Massive fires in Washington state and Oregon have burned more than 2 million acres and forced tens of thousands to evacuate.Ann Skeet, the senior director of leadership ethics at Santa Clara University’s Markkula Center for Applied Ethics, commended the senators’ demands of the CFTC, and said offering bets on how a wildfire spreads could incentivize people to commit Arson.“Somebody could place a bet and then be motivated to actually start a fire,” Skeet said. “There’s just the practical reality of what it is you might be motivating people to do.”Pietruska said she was glad to see the senators’ call to regulate prediction markets, but that the demand was “year and a half late” after the Polymarket bets on the Los Angeles fires.“Gambling on the weather is not new. People have been betting informally on temperature and precipitation around the world for centuries,” Pietruska said. But it’s the “speed and scale” at which Polymarket, Kalshi and others work in a “climate-changed world” that concerns Pietruska, noting police investigations into an incident at Charles de Gaulle airport in Paris, where unusual temperature readings on weather forecasting equipment coincided with suspicious winning Polymarket bets.Neither Polymarket nor the CFTC responded to Guardian requests for comment.The US government has already launched several investigations into Polymarket, the world’s largest prediction market. The Wall Street Journal first reported in June that the agency had begun investigating Polymarket earlier this year, an investigation not publicly detailed but which is the CFTC’s third inquiry into the platform in recent years. In 2022, Polymarket was fined $1.4m for operating in the US without a license.The senators’ letter urged the CFTC to consider whether betting on wildfires was in the “public interest” and gave the agency until 14 August to respond to a list of questions.“The CFTC must lead the charge to rein in these contracts in the US and offshore and put in place commonsense guardrails to prevent people from profiting as wildfires threaten communities,” the letter demanded.