LAS VEGAS - It only took about 15 minutes before the prediction market predicament was raised.
The panels at the Global Gaming Expo (G2E) had just gotten underway on Monday, and a group of regulators were confronted with a question about federally regulated prediction markets and their sports event contracts, which have upended U.S. gambling’s state-regulated status quo.
- At the Global Gaming Expo (G2E), prediction markets and sports event contracts are a significant object of interest.
- State regulators and industry leaders expressed uncertainty and concern, as these markets operate under federal oversight and bypass local sports betting laws.
- With companies like Kalshi, Robinhood, and Polymarket expanding, the currently legal business threatens to disrupt traditional sportsbooks and casino traffic across the U.S.
For example, Mike Leara, executive director of the Missouri Gaming Commission, the gambling regulator for a state that won’t launch legalized sports betting until December, was asked for and offered his (not the commission’s) opinion on prediction markets.
I, too, am at G2E this week, if anyone would like to chat. Already have a suspicion as to what everyone will be talking about, though. pic.twitter.com/DCL5i5Hlof
— Geoff Zochodne (@GeoffZochodne) October 6, 2025
Leara, who was the vice chairman of the board for the Missouri State Employees' Retirement System for more than six years, said during a G2E panel that it is “very generous” to call them prediction markets. To him, he said, these are futures contracts.
Even so, Leara added, Missouri does not have a law on the books at the moment that addresses prediction markets. So, until then, he said they are “being very cautious” about the unfolding situation, while still being told by Missouri sports betting licensees that they do participate in that business.
“Until this makes its way through the court system … I think there's some time ahead of us before Missouri takes a position either statutorily or regulatorily,” Leara said during the panel at the Venetian Expo in Las Vegas.
The stance of Missouri mirrors that of other states that are taking a wait-and-see approach. However, others have gotten more active against prediction markets.
Open for (some) business
Also on the panel with Leara was Mike Dreitzer, chairman of Nevada Gaming Control Board, which is actively fighting with prediction market operators in court. As Dreitzer noted, Nevada's position on prediction markets is widely known: That they are offering what is allegedly unauthorized wagering on elections and sports via event contracts.
At the same time, Nevada wants to be seen as a state that welcomes innovation in gambling products. This includes for Nevada sports betting, provided it complies with all local rules.
“We do want to send the message … that we are open for business,” Dreitzer said.
Again, though, everything must follow the law. And the fight over the legality of sports event contracts continues.
Everybody's talking at me
In the meantime, at G2E 2025, prediction markets and sports event contracts are seemingly finding a way into a lot of the discussion and debate. They are, in some way, inescapable for the legal sports betting and gambling industry overall.
That is because those contracts, which allow people in all 50 states to make de facto sports bets, have thrown a wrench into the status quo for the regulation of the gambling industry.
Historically, this regulation and oversight has fallen to the states. However, the likes of Kalshi and Crypto.com are under the watch of the Commodity Futures Trading Commission (CFTC), a federal regulator. And that regulator has shown no inclination to pump the brakes on the fast-growing business of sports prediction betting.
The business involves users of Kalshi or Robinhood or Underdog buying “yes” or “no” contracts on certain event outcomes, and starting late last year, those outcomes have included ones for sports. Someone could, for instance, buy a "yes" contract on Kansas City to win the Monday Night Football game for 65 cents, and would stand to gain another 35 cents if the Chiefs win.
This means adults in California can bet on sports, even though California has not legalized sports betting. The same goes for every state in the union.
Prediction markets compete for business with state-regulated sportsbooks, yes. But they also could be picking up customers who might visit brick-and-mortar casinos in Las Vegas or elsewhere. So, at G2E, they are a major object of interest.
Some state gambling regulators have tried to fight back, sending cease-and-desist notices and battling in court. So, too, have Native American tribes with gambling interests.
Prediction markets are an "existential threat to tribal sovereignty," said Michael Hoenig, vice president associate general counsel for gaming for the California-based Yuhaaviatam of San Manuel Nation.
"You need to be scared," Hoenig added during a G2E panel on tribal-federal gaming relations.
However, the court fights continue, and sports event contracts continue to trade in the interim. The CFTC, meanwhile, has declined to take a stand.
Indeed, in a Sept. 30 letter to exchange operators, CFTC staff said in a footnote that "all sports-related event contracts that are currently listed for trading on [designated contract markets] have been listed pursuant to self-certifications filed by the relevant DCM … and the Commission has not, to date, made a determination regarding whether any such contracts involve an activity enumerated or prohibited” under the relevant law and regulations.
"Event contracts were never intended for sporting events," Michael Hoening, council for Yuhaaviatam of San Manuel Nation, said during a G2E panel today, echoing other tribal gaming sentiment. "They clearly are a form of sports betting."
— Ryan Butler (@ButlerBets) October 6, 2025
More operators may tip-toe into the sports event contract business. And how could they not? The possibility of acquiring customers in states without legal sports betting, particularly California and Texas, is a huge advantage for prediction markets. A massive offshore prediction market, the crypto-based Polymarket, is also preparing to relaunch in the U.S. after more than three years of operating outside the stateside regulated market.
“We are now in an environment where positive prediction market headlines are a headline risk to gaming stocks until proven otherwise, including the upcoming launch of Polymarket in the United States in the coming weeks,” wrote Jordan Bender, an analyst at investment bank Citizens, in a note to clients on Sunday.
So, at G2E, everyone’s (seemingly) talking about prediction markets, even if it’s just a little bit.
G2E is one of the biggest gatherings on the calendar for the gambling sector. This year's edition, held at the Venetian Expo in Las Vegas, is expected to welcome more than 25,000 attendees from around the world. Many of them exist and do business in the state-regulated version of gambling.
And it’s only Monday. More prediction market chatter is expected throughout the week at G2E, especially when the CEOs of DraftKings, MGM Resorts, and FanDuel-owner Flutter Entertainment speak on Tuesday.
More prediction chatter
On Monday, though, prediction markets were raised during G2E panels on global gambling regulation, the integrity of sports, and even the Ontario sports betting and iGaming market.
Canada’s most populous province does not permit prediction markets because of restrictions on offering so-called “binary options."
Nevertheless, regulators in Ontario are keeping an eye on the situation.
“I’m fascinated by prediction markets and the overlap with securities commissions and where that’s going and where it’s going to land,” said Karin Schnarr, CEO and registrar of the Alcohol and Gaming Commission of Ontario (AGCO), during an Ontario-themed panel on Monday.
Prediction markets came up again during a G2E panel about “navigating the intersection of sports betting and sport integrity,” when panelists were asked if prediction markets will “materially” increase risks.
“I think yes if they’re not regulated properly,” said Rebecca Darin Goldberg, a lawyer in the sports and gaming practice at WilmerHale. “And I think that right now that space is missing some of the foundational integrity elements that we see to regulated sportsbooks, like collaboration with leagues, requirements to report suspicious activity.”
-Additional reporting by Ryan Butler
