California lawmakers call for crackdown on wildfire betting on some prediction markets

By Brady Halbleib

Wagering on wildfires — that’s what some people are doing on prediction markets.

People are betting on when a wildfire could start, how long it will last, how far it will spread and even whether homes will burn.

Prediction markets allow users to wager on the outcomes of real-world events, but not every platform allows wildfire-related markets. Kalshi told CBS News Sacramento that it prohibits them.

California Sens. Adam Schiff and Alex Padilla are among several senators calling for a crackdown on platforms that offer wildfire-related wagers, arguing that profiting from disasters is wrong and could create dangerous financial incentives.

“There’s also the heightened risk — according to state and local fire officials — that individuals could be tempted to commit arson in order to make sure their bets are successful,” the senators wrote in a letter to the Commodity Futures Trading Commission.

Kalshi said that concern is precisely why wildfire markets are not allowed on its platform.

“We don’t allow these markets because they create perverse incentives,” Kalshi said in a statement to CBS News Sacramento.

Ann Skeet, senior director of leadership ethics at the Markkula Center for Applied Ethics, also questions what allowing these types of bets says about society.

“The fabric of society is fraying a little bit when we’re betting on the harm and demise of our neighbors,” Skeet said.

The senators’ letter also points to Polymarket, where more than $1.2 million was wagered on the 2025 Palisades and Eaton fires.

Currently, the Dodd-Frank Act prohibits certain event betting on things like assassination and terrorism, but wildfires and other natural disasters are not included.

“But nobody really anticipated this level of depravity, really, that people would stoop to betting on this kind of weather event,” Skeet said.

Lawmakers are now calling for more guardrails when it comes to putting wagers on disasters, arguing the consequences are not a safe bet.

The Commodity Futures Trading Commission has until Aug. 14 to respond to the senators’ letter.

Meanwhile, Porter hopes any new restrictions apply not just to wildfires, but to betting on all natural disasters.