Catenaa, Monday, June 22, 2026- A coalition of major US gaming organizations is urging the Senate to use upcoming cryptocurrency legislation to prohibit sports prediction markets, intensifying a growing dispute over whether event-based contracts should be treated as financial products or gambling.
According to reports, the American Gaming Association, the Indian Gaming Association and the Association of Gaming Equipment Manufacturers have asked lawmakers to include language in crypto market structure legislation that would explicitly ban sports-related prediction contracts and casino-style event markets.
The request comes as prediction market platforms continue posting record trading volumes and expanding into sports-related contracts under oversight from the Commodity Futures Trading Commission.
The gaming industry argues that prediction market operators are effectively offering nationwide sports betting while bypassing state gambling laws and tribal gaming regulations.
Industry groups claim these platforms have created one of the largest expansions of gambling activity in recent years without voter approval, legislative authorization or the regulatory safeguards required of traditional sportsbooks.
The organizations also warned that younger users may be exposed to gambling-like products marketed as investment opportunities.
The debate is increasingly intersecting with broader cryptocurrency regulation.
Gaming groups are now attempting to attach anti-prediction market provisions to the CLARITY Act and related digital asset legislation moving through Congress.
Their central argument is that sports wagering falls outside the traditional mission of the CFTC and should remain under state gaming regulators rather than federal commodities oversight.
The push comes as prediction markets continue experiencing explosive growth.
Market leaders Kalshi and Polymarket have attracted billions of dollars in monthly trading volume, fueled by sports contracts, political markets and event-driven speculation.
Kalshi reported more than $16 billion in monthly volume during May, while Polymarket exceeded $7 billion during the same period.
The rapid expansion has drawn increasing attention from lawmakers, regulators and state attorneys general.
The CFTC has recently moved to defend its authority over sports-related prediction contracts, launching legal challenges against several states attempting to restrict these markets.
At the same time, lawmakers have introduced separate legislation seeking to classify sports prediction contracts as gambling rather than financial instruments.
The outcome could determine whether prediction markets become a permanent part of the US financial system or face significant restrictions.
Prediction markets gained mainstream attention during the 2024 US election cycle, where traders used event contracts to speculate on political outcomes. Since then, platforms such as Kalshi and Polymarket have expanded into sports, entertainment and economic events. Supporters argue these markets improve price discovery and forecasting accuracy, while critics view them as unregulated gambling. The dispute has become increasingly important as Congress advances crypto legislation including the CLARITY Act, which could reshape oversight of digital assets, derivatives and event-based financial products across the United States.
