A bipartisan Senate bill reportedly seeks to prevent prediction markets from accepting or listing transactions related to sporting events and casino-style games.
The legislation, introduced by Sens. John Curtis, R-Utah, and Adam Schiff, D-Calif., would prohibit platforms regulated by the Commodity Futures Trading Commission — including fast-growing exchanges such as Kalshi and Polymarket — from offering contracts tied to sporting events.
The bill also targets so-called "casino-style games," banning contracts linked to activities such as slot machines, blackjack, video poker, and bingo.
"Clearly something needs to be done," Mick Mulvaney, former White House chief of staff under President Donald Trump during his first administration, said in a statement to Front Office Sports.
Mulvaney, now executive director of a coalition called Gambling Is Not Investing, said prediction market platforms "have unilaterally made sports gambling available on every phone in the country, regardless of local laws and in disregard for consumer protections and safeguards that legal sportsbooks implement."
"The CFTC is attempting to sow confusion about who regulates sports gambling in this country, but the law is clear: sports betting is a state issue," he told Front Office Sports.
Lawmakers backing the measure argue that prediction markets have effectively created a backdoor for nationwide gambling that bypasses state laws and consumer protections.
"The CFTC is greenlighting these markets and even promoting their growth," Schiff said, The Wall Street Journal reported, warning that the platforms intrude on state authority and tribal sovereignty while generating no public revenue.
Curtis echoed those concerns, pointing to the growing exposure of young Americans to what he described as addictive gambling products disguised as financial instruments.
"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," Curtis said.
Prediction markets, which allow users to place yes-or-no wagers on real-world outcomes, have surged in popularity over the past year.
While initially focused on politics and economic indicators, a significant portion of trading activity has shifted to sports, putting the platforms in direct competition with traditional sportsbooks such as DraftKings and FanDuel.
The rapid growth has drawn scrutiny from lawmakers, regulators, and state officials.
Several states, including Nevada and Arizona, have already taken legal action against prediction market operators, arguing they are offering illegal gambling without proper licensing.
Critics say the platforms exploit a regulatory gray area by operating under federal commodities law rather than state gaming rules, effectively allowing betting nationwide, even in states where sports gambling is restricted.
Supporters of the bill argue it will restore proper oversight and protect consumers by ensuring gambling remains regulated at the state level.
Industry players, however, are pushing back.
Representatives for Kalshi warned that banning sports-related contracts on regulated platforms could drive users to offshore markets with little or no oversight.
"Banning sports on regulated prediction markets would just push this behavior offshore, where no regulation exists," a company spokeswoman told the Journal, arguing the legislation could ultimately undermine consumer protections.
The debate comes as prediction markets attract billions in trading volume and major partnerships, including recent deals with professional sports leagues.
At the same time, concerns about insider trading, market manipulation, and the broader social impact of widespread gambling access have intensified.
Charlie McCarthy ✉
Charlie McCarthy, a writer/editor at Newsmax, has nearly 40 years of experience covering news, sports, and politics.
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