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The American Gaming Association and Indian Gaming Association told a House subcommittee on Tuesday that sports event prediction markets are operating like unregulated sports betting, bypassing state and tribal gaming laws and weakening consumer protections.
At the House Agriculture Subcommittee hearing on “Examining Customer Protections and Market Integrity in Sports Event Prediction Markets,” IGA Chair David Bean and AGA Senior Vice President Christopher Cylke said platforms including Kalshi and Polymarket are offering products that mirror legal sportsbook wagers without the same oversight.
Bean said tribes support innovation but oppose sports betting through prediction markets, which he argued have used a weak regulatory structure to offer nationwide online wagering to users as young as 18. He said tribal gaming revenue supports health care, education, housing, public safety, infrastructure, and jobs, and warned that prediction markets threaten those funding streams by sidestepping long-standing gambling rules.
Cylke made a similar case on behalf of commercial gaming operators. He said the legal gaming industry supports 1.8 million U.S. jobs, contributes about $329 billion to the economy, and generates roughly $53 billion a year in tax revenue. He also estimated that states and tribes have already lost more than $1.2 billion in gaming tax revenue since prediction market platforms began offering sports event contracts.
Both witnesses argued that the Commodity Futures Trading Commission is not designed to regulate gambling, responsible gaming, or sports integrity. Cylke said that if sports betting shifts onto non-gaming platforms, suspicious activity could go undetected, consumers could be confused, and confidence in sporting events could be weakened.
For players, one of the clearest issues raised at the hearing was age access. According to the testimony, prediction market products can reach users as young as 18, while nearly all legal U.S. sports betting is restricted to adults 21 and older.
Bean urged Congress to move legislation that would prohibit prediction market operators from offering sports wagering and to block proposed CFTC rules overseeing gambling-related products. More than 40 state attorneys general have already filed legal briefs and comments with the CFTC, according to his testimony.
What happens next is still unclear. The hearing put more pressure on Congress and the CFTC to define whether sports event contracts should be treated as financial products or as gambling, but no immediate federal action was announced.
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Source: As reported by cdcgaming.com.
