00:00You wrote about two U.S. senators have introduced the End Prediction Markets Corruption Act.
00:05That happened just yesterday, which would bar top government officials from buying or selling contracts tied to the outcome of
00:12real-world events.
00:13We know, obviously, the prediction markets and real-world events with what happened in Iran.
00:18It's been a whole fiasco in terms of Kalshi and people chasing money, again, surrounding the death of an individual,
00:25let alone, you know, this isn't us wagering on the, you know, the trading on the side of who wins
00:31a game or who wins an Oscar or something like that.
00:35Again, real-world events.
00:36So what do you make of this act and what's to come?
00:41Yeah, legislation is kind of just a product of where we are with prediction markets right now.
00:46I mean, it's a good question.
00:47It's, you know, prediction markets really started to take off about a year ago.
00:52They've been around for a long time, to be clear.
00:54They were very popular with the election and everything, but when they really started to take off was when Trump
00:59got into office.
01:00All of a sudden, Kalshi started offering sports bets, and that is now about, like, 85%, 87% of their
01:08business.
01:08So to be clear, most of the activity that happens on these prediction markets, this is why you have all
01:14these lawsuits.
01:15You're talking about people being really concerned, senators mainly, about insider information being traded.
01:20You mentioned a couple of cases.
01:21There's about $500 million placed just before the Iran strikes over the past weekend on those strikes happening, which I've
01:31raised questions.
01:32Is there insider trading information being leaked?
01:34You know, anytime you're betting on the outcome of something to happen when it's a government, you know, decision specifically,
01:41there's a concern about, you know, did someone in the White House talk to somebody?
01:44Did somebody's brother place something on it?
01:47When you talk about the state regulations that we have with sportsbooks, it's easier to monitor that stuff.
01:52They have a lot of robust regulations in place.
01:55The issue with prediction markets right now seems to be the CFTC is the one that's supposed to regulate this,
02:00but there's really nobody working at the CFTC.
02:03It's very understaffed.
02:05They really have not flagged any of these cases.
02:07So what you have happen are these instances where you have these sketchy bets being placed.
02:12You know, you mentioned that the Kalshi had to refund bets placed on the Supreme Leader in Iran to be
02:18out by a certain date, clarifying that that's not a war market or an assassination market, which is technically prohibited
02:24under the law.
02:25But it's just the Wild West right now with the regulation, with all these kind of things.
02:29And I think senators are starting to use it as a political standpoint of, you know, we can maybe score
02:35some points by saying everyone's banned from doing this.
02:38And we'll see what happens with this bill.
02:40You know, I'd liken it to the criticism that happens a lot about senators betting on the stock market, which
02:47we know has not been able, they've not been able to pass that in part because, you know, the people
02:52that that's affecting, they're the ones making those decisions.
02:54I don't think they want to do that.
02:56So I wonder what kind of opposition we'll see here, given the fact that it's only really Democrats proposing this
03:01right now.
03:03The Trump administration has been really embracive or embracing prediction markets and, you know, them as sources to find information
03:12faster than the news.
03:13Like to these points, when you have insider information, we know kind of the news before it happens.
03:19But there's the sketchy part of that is, why are people making millions of dollars off of the death of
03:24someone?
03:24So I think lawmakers want to use this as an opportunity to kind of score some political points, rein everything
03:30in.
03:31But we'll certainly see how it develops.
03:33You know, you often have issues in politics that start one way and then they get completely thrown another way.
03:39The prediction markets, things have been, that's not even with the sports factor.
03:44So it's definitely a really interesting story right now to keep watching how Washington's appetite for this stuff kind of
03:50develops and, you know, just where their attention is right now with this stuff.
03:53That's pretty crazy.
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