Opponents of prediction markets have tried making a federal case out of it, but now they’d like to make a federal law about it as well.
- A coalition of gaming, tribal, labor, and regulatory groups urged U.S. senators to ban sports and casino-related prediction market contracts through pending crypto legislation.
- The groups argue prediction markets have created a nationwide expansion of sports betting that bypasses state and tribal laws, consumer protections, and local oversight.
- The push comes as prediction markets grow and stand to gain new regulatory approvals, despite ongoing legal and regulatory battles over the legality of sports event contracts.
A coalition of gaming, tribal, labor, and other groups wrote a letter to members of the U.S. Senate urging them to add language to a crypto bill "that explicitly prohibits event contracts tied to sports and casino-style gaming," according to Semafor.
“While our organizations may differ on other issues, including gambling policy, we are united in our concern that prediction markets have fueled the largest expansion of gambling in U.S. history over the past 18 months - without voter approval or legislative authorization,” the letter says. “By offering nationwide sports betting through so-called ‘sports event contracts’ and branding it as a federally regulated financial product, these platforms have bypassed state and tribal law, weakened consumer protections, and undercut a system built on local control - one that supports jobs, generates tax revenue, and funds community priorities.”
The letter represents a new front in the war that certain groups are waging against prediction markets.
These groups include the American Gaming Association, National Thoroughbred Racing Association, North American Gaming Regulators Association, and Indian Gaming Association, among others.
News: The gaming industry is teaming up with unions to urge senators to add language to pending crypto legislation that would block prediction markets from offering wagers on sports, per a letter seen by Semafor. https://t.co/CIwbEAARTs pic.twitter.com/msJtRwE5kA
— Eleanor Mueller (@Eleanor_Mueller) June 16, 2026
It’s something of an existential battle for these groups, which face the threat of bettors turning away from the products of their members and toward federally regulated prediction markets. The AGA recently estimated states have lost up to $1 billion in gaming tax revenue because of prediction markets.
Time will tell if Congress decides to step in, but the request comes as the prediction market business continues to grow and become more entrenched with consumers. More operators are also being licensed by the Commodity Futures Trading Commission (CFTC), including Novig and ProphetX just this past week.
While we're waiting ...
Moreover, the request for senators to tweak the pending “crypto market structure legislation” is in addition to the numerous lawsuits involving prediction market operators, the CFTC, and state regulators over sports-related event contracts.
Those lawsuits have had mixed results, although Nevada remains the only state to successfully restrict prediction markets to restrict sports-related contracts.
The CFTC recently proposed fresh rules for prediction markets as well, ones that will largely leave their de facto form of sports wagering alone. So, while those lawsuits continue to rage and the regulatory process plays out, prediction market opponents are now asking Congress to settle the issue legislatively.
“Litigation may eventually clarify the law, but this is ultimately a question of congressional intent,” the letter says. “Congress should not wait while this nationwide expansion of gambling continues. It should use crypto legislation to reaffirm a simple principle: sports betting falls outside the CFTC’s remit and cannot be offered through prediction market platforms.”
