Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below.
As concerns grow surrounding the prediction market industry, the Commodity Futures Trading Commission (CFTC) has proposed new limits on what topics can and can’t be subject to wagers.
While sports bettors might shrug, people who enjoy exploring the fringes of prediction markets are likely to grumble.
Top Picks
The proposal, which was first reported by The Wall Street Journal, would give the CFTC the ability to block wagers it feels are not in the public interest or could be susceptible to manipulation (1). That would likely do away with bets on things like war or player injuries in sports, though wagering on the outcome of the game would still be permitted.
If placing wagers on the outcomes of military actions seems unlikely to you, you might be surprised to know it’s already happening — and a U.S. soldier has already been caught in the crossfire.
No specific bans
The proposal issued by the CFTC doesn’t come out of nowhere. It follows existing guidance the CFTC has already given to prediction markets on where bets should be avoided. However, while the proposal does outline the factors regulators will use when determining if a bet is appropriate, it does not specifically list any type of banned topics.
The objective, say officials, is not to hinder growth, but rather to regulate the markets and cut down on fraud and bets on geopolitical events — which could lure people with knowledge of secret information to make a bet, potentially alerting an enemy to a military attack or endangering lives.
In fact, this was an issue earlier this year when the U.S. Attorney’s Office for the Southern District of New York announced a U.S. soldier named Gannon Ken Van Dyke had been arrested and charged for placing bets on Polymarket, one of the world’s largest prediction markets, using classified information he had access to regarding the capture of Nicolás Maduro, the former president of Venezuela (2).
Van Dyke allegedly bet just over $33,000 on the markets before the military action, winning nearly $410,000, officials say. He was charged with three counts of breaking the Commodity Exchange Act, one count of wire fraud and one count of an unlawful monetary transaction. All told, this could amount to a maximum sentence of 60 years in prison.
Federal control
The proposed limits on prediction markets come as the spotlight on these outlets intensifies, especially considering younger generations of Americans show the most interest in sports betting and prediction markets. Most recently, a 2026 study by Northwestern Mutual found that Gen Z (32%) and millennials (24%) were the generations with the largest share currently investing in or considering investing in these activities (3).
In response to this growing interest, the CFTC has fought to keep control of prediction markets on the federal level.
In May, for instance, the commission announced that it had filed a lawsuit to block Minnesota from implementing a new law, currently set to go into effect on August 1, that would make operating and participating in prediction markets a criminal felony (4). The commission reported that it had also taken legal actions against five other states to prevent regulation of prediction markets.
Stick to safer bets instead
The excitement around prediction markets can make them feel like an easy way to make money — but the reality is far more complicated.
Recent data suggests many traders are struggling to come out ahead. A recent analysis by The Wall Street Journal found that 67% of profits on Polymarket go to just 0.1% of accounts (5). And of the 1.6 million accounts studied, more than 1.1 million were unprofitable. Over on Kalshi, a different prediction market, there are 2.9 unprofitable users for every profitable one.
In another analysis reported by CNBC, more than 70% of Kalshi traders reportedly lost money over a six-month stretch, while roughly 69% of accounts on Polymarket lost money since 2022 (6). Meanwhile, 77% of the gains were reported to have gone to the top 1% of users on Polymarket.
The lesson here is that for those looking to build lasting wealth, chasing short-term wins can be a risky approach. For this reason, traditional strategies — like investing regularly, holding diversified assets and letting compound growth do the heavy lifting — may be a more reliable path.
Get expert advice
Finding great investments isn’t always about spotting the next big thing — sometimes it’s about identifying quality companies that may be trading below their true value. But separating a hidden gem from a struggling company can be tricky, especially when markets are volatile.
If you don’t have time to spend tracking economic reports, company earnings and market shifts, expert guidance can help make the process easier.
That’s why Moby offers expert research and recommendations to help you identify strong, long-term investments backed by advice from former hedge fund analysts.
In four years, and across almost 400 stock picks, their recommendations have beaten the S&P 500 by almost 12% on average. They also offer a 30-day money-back guarantee.
Moby’s team spends hundreds of hours sifting through financial news and data to provide you with stock and crypto reports delivered straight to you. Their research keeps you up-to-the-minute on market shifts and can help you reduce the guesswork behind choosing stocks and ETFs.
Plus, their reports are easy to understand for beginners, so you can become a smarter investor in just five minutes.
Build better financial habits
Instead of trying to predict the next big market move, consider focusing on building habits that can help your money grow consistently.
One of the simplest strategies is investing regularly through a diversified portfolio or broad market index fund. By contributing steadily over time, you can take advantage of compound growth without worrying about perfectly timing the market.
Platforms like Acorns allow users to invest spare change from everyday purchases automatically, helping them steadily build wealth without having to think about every market move.
It works like this: All you have to do is link your cards, and Acorns will round up each purchase to the nearest dollar, investing the difference — your spare change — into a diversified portfolio of ETFs managed by experts at leading investment firms like Vanguard and BlackRock.
With Acorns, you can invest in an index ETF with as little as $5 — and, if you sign up today and set up a recurring investment, Acorns will add a $20 bonus to help you begin your investment journey.
Diversify with a safe haven asset
Even if you avoid prediction markets and stick with traditional investing, volatility is still part of the game.
Stocks have faced plenty of uncertainty lately, and shifting global events can quickly impact investor sentiment. Gold has long been considered a potential safe haven asset because it tends to move differently from stocks during periods of market stress.
Opening a gold IRA with the help of Goldco allows you to invest in gold and other precious metals in physical forms while also providing the significant tax advantages of an IRA.
With a minimum purchase of $10,000, Goldco offers free shipping and access to a library of retirement resources. Plus, the company will match up to 10% of qualified purchases in free silver.
If you’re curious whether this is the right investment to diversify your portfolio, you can download your free gold and silver information guide today.
Invest in real estate with as little as $100
Real estate has long been a popular asset class for investors seeking growth and income.
Unlike stocks, property values don’t always move in sync with the market, which can make real estate a useful way to diversify your portfolio. Beyond potential appreciation, rental properties can provide recurring income.
The downside? Owning property comes with plenty of responsibilities — from managing tenants to covering repairs and unexpected expenses.
But with crowdfunding platforms like Arrived, you can invest in real estate without the burden of mortgages or managing tenants. And you can get started with as little as $100.
Backed by world-class investors like Jeff Bezos, Arrived lets you purchase shares of vacation and rental properties across the country. Arrived distributes any rental income generated by properties to investors monthly, allowing you to potentially set up a passive income stream without the extra work that comes with being a landlord of your own rental property.
The best part? For a limited time, when you open an account and add $1,000 or more, Arrived will credit your account with a 1% match.
— With files from Chris Morris
You May Also Like
Join 250,000+ readers and get Moneywise’s best stories and exclusive interviews first — clear insights curated and delivered weekly. Subscribe now.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
The Wall Street Journal (1),(5); U.S. Department of Justice (2); Northwestern Mutual (3); Commodity Futures Trading Commission (4); CNBC (6)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.