The U.S. Commodity Futures Trading Commission (CFTC) may have pulled the plug on an in-person discussion about prediction markets late last month, but that doesn’t mean the concerns about those exchanges and their controversial sports event contracts have gone away.
- On Thursday, tribal gaming leaders are set to voice their concerns about sports event contracts and federally regulated prediction markets during a conference call with the CFTC.
- Some of those concerns were already conveyed to the CFTC ahead of a roundtable on prediction markets, but the roundtable was canceled without explanation by the federal regulator.
- What the CFTC will do with the feedback is unclear, and the regulator is going through a leadership transition, but Thursday’s call provides an opportunity for further feedback about the controversial products offered by prediction markets, which are operating beyond state-level oversight.
Now, the CFTC is scheduled to hear some of the concerns it would have heard at its aborted roundtable, and from one of the more concerned and interested parties: Native American tribes that operate casinos.
The CFTC is set to host a conference call with tribal leaders on Thursday to discuss federally regulated prediction markets (such as Kalshi and Robinhood) and, presumably, the sports event contracts they offer.
Largest trades at tip off
— Kalshi (@Kalshi) May 28, 2025
Who you got tonight? pic.twitter.com/9PVxY5Lc8U
Trading of event contracts (overseen by the CFTC) has become a major issue in the world of commercial and tribal gaming, as they allow prediction market users to make de facto wagers in all 50 states, not just those with legal sports betting.
The wagers don't necessarily need to be on sports either, as prediction markets offer contracts tied to economics, politics, and pop culture.
The trading can even take place on tribal lands, or in states where the tribes have exclusive gambling rights. In other words, prediction markets and their event contracts, sports or otherwise, represent potential competition for casino and sportsbook operators.
'A serious threat'
Rodney Butler, chairman of the Connecticut-based, Foxwoods Resort Casino-owning Mashantucket Pequot Tribal Nation, suggested on Wednesday that they are unsure of what to expect from Thursday’s call.
However, Butler added, it is important tribes stress to the CFTC the “real impact” prediction markets have on commercial and tribal gaming operations, as well as what they mean for the federal and state-approved gaming agreements that tribes have.
“It's a serious threat, and the CFTC needs to understand that and understand our concerns,” Butler said during the Indian Gaming Association’s “The New Normal” webcast. “Obviously, all the legal concerns around it notwithstanding.”
Those legal concerns continue to mount, as several states have sent cease-and-desist letters to prediction market operators, namely Crypto.com, Kalshi, and Robinhood.
Crypto and Kalshi have fired back with lawsuits, and cited their federal regulation and lack of CFTC pushback as reasons to preempt state-level oversight. Thus far, the courts have ruled in favor of the prediction markets and pointed to federal jurisdiction in doing so.
“A big problem in all of the cases so far is there … hasn't been a tribal voice, even though this has such a dramatic and direct impact on Indian country,” said Joseph Webster, a veteran tribal gaming lawyer and the managing partner at Hobbs, Straus, Dean & Walker, LLP, during Wednesday’s webcast. “To the extent that [the federal Indian Gaming Regulatory Act] has been discussed, it's been discussed by other parties, and not tribes, and I think that's been a problem.”
The CFTC is also in a state of transition at the moment, as a new, permanent chairman has yet to be confirmed by Congress and all of the current commissioners appear to be on their way out.
Farewell Remarks by @CFTCcgr: The Future of Financial Services Regulation: https://t.co/rrQYMS9UBC
— CFTC (@CFTC) May 27, 2025
What exactly the CFTC will do, then, with the feedback it gets on Thursday remains to be seen. Yet it is clear the concerns about sports event contracts and prediction markets will not fade away anytime soon.
“I think the only way this is going to be settled is through the courts,” said Victor Rocha, the Indian Gaming Association’s conference chairman, during Wednesday’s webcast.
Dear CFTC, make it stop
Tribes expressed some of their concerns in letters sent to the CFTC ahead of the roundtable. However, the planned get-together on April 30 was called off without explanation, preventing participants from airing the issues they may have with federally regulated prediction markets in an in-person setting.
Still, more than two dozen interested parties provided feedback to the CFTC ahead of the scrapped roundtable, tribes included.
The comments from the tribes highlighted their opposition to sports event contracts. For example, the California Nations Indian Gaming Association (CNIGA) urged the CFTC to prohibit sports event contracts for federally regulated prediction markets like Kalshi.
“Trading of Sports Contracts is gaming, violates state and federal law, and is contrary to public policy for various reasons,” CNIGA Chairman James Siva wrote in a February letter to the commission. “Importantly, allowing Sports Contracts to be listed and traded will interfere with the sovereign right of tribes and states to exercise their police power to regulate gaming within their respective territories – a right long recognized by courts throughout the United States.”
