Senators Demand Crackdown On Wildfire 'Prediction Markets' (arstechnica.com) 67
An anonymous reader quotes a report from Ars Technica: Several US senators have written a letter to the Commodity Futures Trading Commission (CFTC), inquiring about the agency's "plans to crack down on prediction markets" that offer "contracts for individuals to bet on wildfires." "Offering bets on destructive wildfires threatens to minimize communities' suffering, all so the rich and powerful can profit," wrote (PDF) the group of senators, who represent Oregon, California, Nevada, Minnesota, and New Hampshire. The document specifically cites that Polymarket hosted bets in January 2025 on the wildfires in Los Angeles, and it mentions another website which specifically accepts "simulated bets" exclusively on California wildfires.
"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 letter continues. "By offering contracts on fires, prediction market sites run the risk of encouraging people to influence fires that have already started, creating additional concerns around public safety and insider trading." [...] Kalshi spokesperson Elisabeth Diana told Ars by email that the company does not allow such wildfire markets "because they create perverse incentives." But its primary rival, Polymarket, has taken a different approach. A spokesperson for Polymarket told Ars in an emailed statement that the company does not "profit from outcomes," adding that people "come to Polymarket for information." "While we are not blind to the risks, removing these markets does not prevent a tragedy but makes the most accurate information less accessible to the people who need it most," he wrote.
"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 letter continues. "By offering contracts on fires, prediction market sites run the risk of encouraging people to influence fires that have already started, creating additional concerns around public safety and insider trading." [...] Kalshi spokesperson Elisabeth Diana told Ars by email that the company does not allow such wildfire markets "because they create perverse incentives." But its primary rival, Polymarket, has taken a different approach. A spokesperson for Polymarket told Ars in an emailed statement that the company does not "profit from outcomes," adding that people "come to Polymarket for information." "While we are not blind to the risks, removing these markets does not prevent a tragedy but makes the most accurate information less accessible to the people who need it most," he wrote.
Re: Bulshit solution looking for a problem (Score:5, Insightful)
Yeah, it is totally different from those other disasters. I can't place a Polymarket bet on there being a hurricane and then go out and cause a hurricane.
I can, on the other hand, place a bet on a wildfire and then go start one.
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Can't we prosecute arsonists? Or do we need to focus on the dipshits that bet on every possible topic imaginable?
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It's hard to catch an arsonist: there's few cameras in the forest. And it's not the gambling site member but some stinky bum who's doing it for a single bottle of vodka or a hit of fentanyl.
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about 20% of arsons are cleared. You don't need a camera in the forest to catch someone.
Re: Bulshit solution looking for a problem (Score:3)
Prosecuting arsonists doesn't unwind time, bro.
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is it the 1980's again and this is pulled from your tight 5 minutes about "how weatherman get things wrong"?
no wonder you post as ac, this is incredibly lame even for such a sad fucker like yourself
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This is about not making the geriatric scientophobic morons in charge of the country look bad. Their go-to response is always that disasters are unpredictable and there's nothing to be done for it. Meanwhile, the actual experts can all predict wildfire patterns pretty well.
Tough for the degenerates in congress to keep feigning ignorance if the experts are allowed to start raking in $$$ calling their bluff.
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Do the police have access to those betting patterns?
With any wildfire which was initiated deliberately, I'd want to look at anyone who "predicted" it - and their associates.
Re: Bulshit solution looking for a problem (Score:3)
There are hundreds of millions in the table.
It's entirely possible for someone to pay someone to start fires, or, have someone reach out with "proof" they started one and ask for payment. Creating a process that encourages either action is only going to make things substantially worse.
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As the Trump admin showed us, the prediction value is meaningless. That's because someone with inside knowledge / plans can make a bet too close to an event for anyone to prevent it. Think about the bets on capturing Maduro or the start of the Iran war.
The whole "we don't profit" is crap too. They take a fee from a bet being placed, so they profit from every bet. They simply have no interest in which way it pays out.
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That said, I'm not seriously challenging your assertion - Rather, if we presume you're primarily correct, that's been the case absent financial motivation up until now. Pyros aren't in it for the money, they're in it for the show.
If nothing else, I'm sure investigators would love the short list of who bet on fire-X.
Re:Bulshit solution looking for a problem (Score:4, Informative)
The #1 cause of wildfires in California isn't lightning, or a fallen power pole. It is arson.
Actually, it is people. That includes:
- careless debris burning;
- machines and vehicles;
- power lines;
- unattended or poorly-extinguished campfires;
- smoking and fireworks;
- and yes, arson.
Of these, the first one (debris burning) is the most common human cause.
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Hmm, do you think maybe it was a mistake to plant all those eucalyptus trees beside the power lines? XD
Our freedom to be irresponsible (Score:5, Informative)
The #1 cause of wildfires in California isn't lightning, or a fallen power pole. It is arson.
11-15% - equipment use and vehicles. mowers, dirt bikes w/o arrestors, tow chains, flat tire sparks, etc.
6%-10% - arson. specifically a criminal act with human intent.
10% - utility infrastructure. winds blowing trees into lines, fallen utility poles, etc.
10-15% - lightning and natural causes.
35%-45% - miscellaneous human accidents. open burning, fire arms, fire works, smoking, kids with matches, etc. Potentially criminal negligence but a distinct category from arson.
Arson isn't really #1, at least how I think it would be typically defined. I would say negligence is the biggest super-topic among these. And solving only arson is insufficient to addressing the other more significant factors.
Re:Bulshit solution looking for a problem (Score:4, Informative)
> Funny, how the authors don't hate the would-be arsonists — nowhere close to their disdain for the "rich and powerful", who might (might not!) profit from the betting...
Not really funny, it's pretty obvious they're trying to discourage arsonists. If you'd read your own post before posting it, you'd have noticed they haven't written in opposition to people betting on "hurricanes, floods, and tsunamis", which you give as examples of "similar" things but give lipservice to the fact they can't be man made.
This is specifically about avoiding rewarding people for placing bets on wildfires existing and then organizing their creation. You'd have to be dumber than a libertarian or Trump supporter not to see that.
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Minor correction, they can't be individually man made. Pretty sure what humans are doing are still making those other things worse or more likely.
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> Totally different from hurricanes, floods, and tsunamis, right?
I think the difference is, people generally can't start hurricanes, floods, and tsunamis.
Well, maybe floods.
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\"people generally can't start hurricanes,"
An RAF mechanic swinging the prop during the Battle of Britain
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Clever.
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What about butterflies?
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I totally think you should prevent people from making money from wildfires. Arson is easy, the risk of getting caught it probably low, and people see a simple opportunity to make money. Betting is usually something you do about events that are far out of control of the people betting on them. Here your best chances were the prediction market not betting against you because they suspect you cheat, or bets not paying good because the odds against arson become too small when many people bet on the wildfire. Bo
California (Score:5, Interesting)
California should just make putting a bet on wildfires a crime equal to starting a wildfire.
Re: California (Score:2)
Indeed that will not help because criminality doesn't make people not commit an act, only allows us to punish them later, but you can't squeeze billions in fire damages out of the indigent.
Barring actually meeting people's needs, which the state can't do while simultaneously paying the bills shithole states can't cover, banning betting on wildfires is reasonable.
Re: California (Score:2)
It specifically addresses the very real and serious risk that someone would intentionally start a fire to win a bet. It would be fairly easy to get a subpoena to get the records of CA winners of such bets.
Re: California (Score:2)
No it doesn't for the simple reason I already explained.. Making it illegal to place the bets or collect will not stop someone from doing it in the first place because they don't know or think they can get away with it. It must be illegal to advertise the bet, let alone to pay it, so that hopefully no one is induced to do it by the promise of reward. Making it illegal won't actually prevent it of course but since this is still the available tool it should at least be used at the right level.
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Indeed that will not help because criminality doesn't make people not commit an act
False. There is a strong correlation between not committing an act when it's criminal vs when it isn't remotely considered in law. You're misreading the statistics which say that the *severity of punishment* is not correlated with not committing an act.
i.e. Plenty of reasonable people don't do things simply because it is illegal to do so. Likewise if someone decides to do it anyway, the level of punishment doesn't change their mind.
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You're misreading the statistics which say that the *severity of punishment* is not correlated with not committing an act.
Actually, that conclusion is borne out from research by criminologists. They widely conclude that what deters criminal behavior is not the punishment for it, but the fear of getting caught.
In 1976, Canada abolished capital punishment officially. In the decades that followed, the murder rate went down steadily.
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Again that's what I was saying. Notice that Canada abolished capital punishment. They didn't simply legalise everything that lead to it. Also speaking of statistics, while an increase in punishment doesn't correlate to an decrease in crime, the reverse isn't true. They are not correlated, not negatively correlated. Canada's murder rate went down for reasons unrelated to the abolition of capital punishment (which itself doesn't affect murder in the slightest).
Now making murder legal on the other hand...
accessory to murder if some one dies may end it (Score:2)
accessory to murder if some one dies may end it.
individuals could be tempted to commit arson in order to make sure their bets are successful.
So, similar to .. (Score:2)
"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,"
predators (Score:2)
Crime pays (Score:5, Insightful)
Prediction markets introduce a whole new way to benefit from crime.
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Mostly by the sort of people who typically lack the resources to avoid prison. So I don't see the big deal. They can play stupid games and win stupid prizes.
Disasters futures are now a thing :o (Score:2)
It can also temp people into starting the fires themselves
Go after the execs (Score:5, Insightful)
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And what are you considering an army? You need more than body and security guards to qualify as an army. Under a definition like that, every national bank could be said to have a private army, as they'll have a regiment's worth of security guards spread across all their branches.
Besides, it wouldn't be economical for a corporation to maintain a private military force unless that's their business. If Microso
Re: Go after the execs (Score:2)
Of course you can. They're called drones, Ed.
Who's betting against them? (Score:2)
So Arnie the Arsonist is standing in the middle of a bone dry field, with a lit match in his hand, saying "betcha there's going to be a wildfire starting right here!". Who's the mark taking that bet?
Legal gambling sucks (Score:2)
Just rebranded gambling bootstrapped into place by crooked regulators, turbocharged by tech, the eventual tragedies are so predictable. We've been here before, and we seem to have to relearn lessons. Once enough folks ruin their lives and their family's lives there will be some pearl clutching and eventual re-regulation. Sadly we have to live through all the ruined lives while people learn the hard.
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It needs to be cleared up either with legisla
Wow (Score:2)
Re: Wow (Score:2)
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Prediction markets add no value.... (Score:3)
I don't understand how the entire concept isn't just outlawed and thrown out? The core reason we have a stock market is to allow business growth/prosperity. Company owners trade off their original ownership of a successful business for a chance to get investor income flowing in to make the business more successful than they could make it on their own.
Prediction markets are nothing more than gambling. There's no "investing" in a business happening at all with this.
Unless Orangie does it, (Score:2)
then it's considered beatified behavior.
Honest question about using prediction markets (Score:2)
Let's drop the conceit. (Score:3)
You don't need to gamble in order to get people's opinions about the future. The entire concept is pretense to make gambling look like something else so the platforms can play "the house".
Insurance is a bet (Score:2)
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Gambling is never a solution - except for the dumb, desperate, or crooked.