diff --git a/domains/internet-finance/congressional-insider-trading-legislation-for-prediction-markets-treats-them-as-financial-instruments-not-gambling-strengthening-dcm-regulatory-legitimacy.md b/domains/internet-finance/congressional-insider-trading-legislation-for-prediction-markets-treats-them-as-financial-instruments-not-gambling-strengthening-dcm-regulatory-legitimacy.md
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+---
+type: claim
+domain: internet-finance
+description: The Torres Act applies securities-style insider trading rules to prediction markets signaling Congressional acceptance of the financial market framework rather than gambling regulation
+confidence: experimental
+source: Rep. Ritchie Torres, Public Integrity in Financial Prediction Markets Act of 2026
+created: 2026-04-10
+title: Congressional insider trading legislation for prediction markets treats them as financial instruments not gambling strengthening DCM regulatory legitimacy
+agent: rio
+scope: structural
+sourcer: Rep. Ritchie Torres
+related_claims: ["[[futarchy-governed entities are structurally not securities because prediction market participation replaces the concentrated promoter effort that the Howey test requires]]"]
+---
+
+# Congressional insider trading legislation for prediction markets treats them as financial instruments not gambling strengthening DCM regulatory legitimacy
+
+Rep. Ritchie Torres introduced the Public Integrity in Financial Prediction Markets Act of 2026 to bar federal employees and elected officials from trading on political outcomes they might influence. The bill explicitly applies to DCM-designated platforms like Kalshi and Polymarket. The legislative framing is critical: Torres applies insider trading concepts from securities markets (analogous to the STOCK Act for Congressional stock trading) rather than gambling restrictions. This represents Congressional legitimization of prediction markets as financial instruments. The bill emerged as platforms gained DCM designation and federal legitimacy, suggesting Congress views regulation-and-legitimization as the appropriate response rather than prohibition. The bipartisan framing around 'public integrity' makes this politically durable despite broader partisan divides on prediction markets. The STOCK Act precedent is instructive: that legislation didn't kill Congressional stock trading, it clarified rules and legitimized the activity under a regulatory framework. The Torres bill follows the same pattern for prediction markets.
diff --git a/domains/internet-finance/futarchy-governance-markets-create-insider-trading-paradox-because-informed-governance-participants-are-simultaneously-the-most-valuable-traders-and-the-most-restricted-under-insider-trading-frameworks.md b/domains/internet-finance/futarchy-governance-markets-create-insider-trading-paradox-because-informed-governance-participants-are-simultaneously-the-most-valuable-traders-and-the-most-restricted-under-insider-trading-frameworks.md
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+---
+type: claim
+domain: internet-finance
+description: Applying insider trading rules to governance prediction markets would exclude the participant class most likely to improve decision quality creating a structural tension between information efficiency and regulatory compliance
+confidence: speculative
+source: Torres Act implications for futarchy, agent analysis
+created: 2026-04-10
+title: Futarchy governance markets create insider trading paradox because informed governance participants are simultaneously the most valuable traders and the most restricted under insider trading frameworks
+agent: rio
+scope: structural
+sourcer: Agent analysis of Torres Act implications
+related_claims: ["[[futarchy-governed entities are structurally not securities because prediction market participation replaces the concentrated promoter effort that the Howey test requires]]", "[[optimal governance requires mixing mechanisms because different decisions have different manipulation risk profiles]]"]
+---
+
+# Futarchy governance markets create insider trading paradox because informed governance participants are simultaneously the most valuable traders and the most restricted under insider trading frameworks
+
+The Torres Act's insider trading logic creates a structural problem when applied to futarchy governance markets. In corporate prediction markets about external events, insider trading rules make sense: federal officials with non-public information about policy decisions shouldn't trade on those outcomes. But in futarchy, the token holders who vote on proposals are by definition 'insiders' — they can influence the outcomes that prediction markets are forecasting. If Torres-style insider trading logic were extended to governance markets, it would require governance participants to not trade on governance outcomes. This creates a paradox: the people with the most information and influence (active governance participants) would be excluded from the markets designed to aggregate their information. This is likely NOT the legislative intent of the Torres bill, which targets federal officials with unique non-public information about government decisions, not DAO token holders whose influence is public and on-chain. However, the conceptual tension reveals a boundary condition for futarchy adoption: as governance prediction markets gain regulatory legitimacy, they may face pressure to restrict trading by 'insiders' (governance token holders), which would undermine the core mechanism. The resolution likely requires distinguishing between non-public information asymmetry (which insider trading rules target) and public governance influence (which futarchy requires).
diff --git a/entities/internet-finance/ritchie-torres.md b/entities/internet-finance/ritchie-torres.md
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+# Ritchie Torres
+
+**Type:** person  
+**Status:** active  
+**Domain:** internet-finance
+
+## Overview
+
+Rep. Ritchie Torres (D-NY) represents the Bronx in the U.S. House of Representatives. A progressive Democrat generally crypto-skeptical, Torres introduced the Public Integrity in Financial Prediction Markets Act of 2026, applying insider trading rules to prediction markets.
+
+## Timeline
+
+- **2026-04-01** — Introduced Public Integrity in Financial Prediction Markets Act barring federal officials from trading on political prediction markets
+
+## Significance
+
+Torres's insider trading bill is notable because it treats prediction markets as financial instruments requiring securities-style regulation rather than gambling prohibition, representing a legitimization pathway for the industry despite his generally skeptical stance on crypto.
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