The kind of year that 2025 was for the legal gambling industry should give the American Gaming Association reason to celebrate. Revenue hit a record high, sportsbook handle shot up, and states were handed billions in wagering-related tax money.
But can the AGA spike the football? Can it set off fireworks? Pop some champagne?
Spoiler alert: no
“Overall, 2025 was another strong year, but at the AGA, we never take gaming success for granted,” CEO Bill Miller said Thursday during the industry group’s State of the Industry webinar.
So there will be no rager for the AGA just yet. And that is because any party the AGA throws would be threatened by the presence of prediction markets, which the association estimates have cost governments more than $500 million in potential sports betting tax revenue thus far.
“The battle against prediction markets is a defining fight for our industry,” Miller said.
- The American Gaming Association reported record 2025 revenues and sports betting growth.
- Despite the boom, the AGA warns that federally regulated prediction markets threaten state-based gambling markets.
- The dispute has split major operators like DraftKings, FanDuel, and Fanatics from the AGA, as political allies such as Chris Christie join the fight against prediction markets.
“Prediction markets threaten what I've long called the American blueprint for gaming,” Miller added. “This blueprint has been a key to gaming's growth into a nationwide industry. It's built on some ironclad commitments, including a state-by-state, tribe-by-tribe approach that gives local communities the deciding vote on gaming.”
The American Gaming Association announced today that commercial sports betting revenue hit $16.96 billion in 2025, up 22.8%, and on handle of $166.94B, which was up 11%. Sportsbooks paid $3.71B in taxes to states as well, up 32.4%. pic.twitter.com/MvmZbcnU2Z
— Geoff Zochodne (@GeoffZochodne) February 26, 2026
The results “speak for themselves,” Miller said. Among other things, the AGA reported on Thursday that U.S. commercial gaming industry revenue hit a record high of $78.72 billion in 2025, up 9.2% from the previous year. That money translated into $18.09 billion in gaming tax revenue, an 15.1% increase from 2024.
Included in those figures are the contributions of state-regulated sportsbooks. According to the AGA, sports betting revenue rose 22.8% in 2025 to almost $17 billion. Handle increased 11% to approximately $167 billion. Meanwhile, state-licensed bookmakers handed over more than $3.7 billion in tax money, which was up 32.4% compared to 2024.
So, even as business appears booming for the legal gambling industry, it can’t fist-pump too vigorously.
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The mere presence of federally regulated exchanges is a threat to the status quo of gambling regulation in the U.S., which was historically left to the states. That includes state-regulated online sports betting, as prediction markets offer a similar product that is available all over the U.S., not just in states that have legalized sports wagering.
Prediction markets are federally regulated by the Commodity Futures Trading Commission, and it is that federal oversight they point to when state gambling regulators argue their products are just illegal gambling.
Still, several states are pushing back against the legality of sports event contracts in court, and the AGA is trying to rise to the challenge by raising awareness of the issue with the public and among lawmakers.
However, the issue has caused a split among companies offering online sports betting in the U.S. DraftKings, FanDuel, and Fanatics are now all former members of the AGA, as the sportsbook operators have gone off and launched prediction markets of their own.
Yee-huh?
Former New Jersey Gov. Chris Christie, who played a big role in helping legalized sports betting expand across the U.S., is now working as an adviser for the AGA in its fight against sports event contracts. He, too, spoke during Thursday’s webinar, saying his first reaction to seeing prediction markets enter the sports space was that “it’s illegal.”
“It's disrespectful of all 50 states,” Christie added. “It violates the laws of all 50 states, and I think that over the course of time, either the courts or our political institutions are going to say this is not what we bargained for.”
Prediction market operators want to be “rogue cowboys,” the former governor said, and are not offering the same sort of responsible gambling frameworks as the states.
“This is not a commodity,” Christie said. “This is a bet. Everyone knows what it is. It is a bet on a game. And it's not a commodity. It's not something that is even in (the federal Commodity Futures Trading Commission’s) ballpark to regulate.”
Miller said the trust that the AGA and its members have built by following the rules has them “positioned to win the fight against prediction markets,” which it has to do while lobbying for other policies, including the restoration of the 100% gambling loss deduction.
“We're not just protecting what we've built, we're securing the foundation for continued growth and a better future for gaming,” Miller said.
