A bipartisan bill has been introduced by a pair of US senators to ban ‘casino-style games’ and sports event contracts from being listed on prediction market platforms, according to reports.
The Wall Street Journal (WSJ) reported that entities regulated by the Commodity Futures Trading Commission (CFTC), including prediction markets such as Kalshi and Polymarket, would be regulated through the bill. NBC News has since reported that this bill has been introduced to the US Senate.
Senator Adam Schiff and John Curtis are co-sponsoring the legislation, the first bipartisan Senate bill seeking to regulate prediction markets. They believe prediction markets need to be brought under state control.
Schiff stated, according to the WSJ: “The CFTC is greenlighting these markets and even promoting their growth. It’s time for Congress to step in and eliminate this backdoor, which violates state consumer protections, intrudes upon tribal sovereignty and offers no public revenue.”
If the bill is given the green light, prediction markets would be prohibited from listing ‘casino-style games’ in their platforms, including bingo, blackjack, slots and video poker.
Curtis added: “Too many young people in Utah are getting exposed to addictive sports betting and casino-style gaming contracts that belong under state control, not under federal regulators.”
Contentious industry issue
Prediction markets don’t appear to be going away anytime soon. They have quickly become a contentious issue within the iGaming industry as online casino and sports betting expand globally.
While some operators, such as FanDuel and DraftKings, have expanded their offerings to cover the vertical, others have thrown criticism in the direction of the platforms.
Earlier this month, Entain Chief Executive Officer Stella David claimed that prediction markets facilitate underage sports betting in the US since many platforms that are CFTC-regulated have a minimum age requirement of 18, while many states require players to be 21 to gamble.
David said: “When people play the prediction markets in sports, it looks like a sports bet, it sounds like a sports bet, and it acts like a sports bet. I don’t think anybody should be in any doubt. It’s sports betting.
“In the US, you’ve got to be 21 to play, [but] 18 to 21-year-olds are playing prediction markets, and they’re playing prediction markets in non [online sports betting] regulated states.”
Some US states are ordering prediction markets to cease their offerings in their respective markets, including a Nevada state court judge blocking Kalshi last week from offering sports event contracts in the state for at least 14 days.
Other countries across the world have had their say on prediction markets. New Zealand recently issued a statement prohibiting such platforms in the country. A judge in Buenos Aires, Argentina, has banned Polymarket from the region. Meanwhile, Liberia has authorised prediction markets under its regulation.
Adam Greenblatt, CEO of BetMGM, Entain’s joint venture with MGM Resorts International, believes prediction markets are operating illegally in the US.
Greenblatt noted: “Our position is clear and aligned with almost 40 state attorneys general, our regulators and our tribal partners. As the law stands today, sports prediction markets are, in essence, illegal sports betting.
“Prediction market operators have no requirements to protect consumers as licensed sports betting operators do. They do not uphold responsible gaming principles. They do not have self-reporting obligations for compliance failings and do not have whistleblowing and information sharing obligations.”
