Congress is preparing to deepen its examination of online gambling as policymakers focus on sportsbooks and the fast-growing prediction market industry. The hearings reflect bipartisan concern over integrity risks, regulatory gaps, and uncertainty over how these platforms should be classified.
Recent sports controversies have sharpened scrutiny. Texas Tech University quarterback Brendan Sorsby entered a treatment program after admitting he placed small wagers on his former team, the Indiana Hoosiers, before transferring. He is now seeking an injunction to return to college football in 2026. Lawmakers have also cited gambling-related incidents across the NBA and MLB as part of broader integrity concerns.
Sen. Marsha Blackburn, R-Tenn., who chairs a Wednesday hearing, said the committee is reviewing both sportsbooks and prediction markets. “People are saying, ‘hey wait a minute, you’ve got a referee, this is supposed to be fair,” she said.
She also warned that “there are some dangers that are thereit does have an impact on the integrity of the sports marketplace.”
Beyond sports, lawmakers raised concerns about prediction markets tied to global events. A “60 Minutes” report cited accounts linked to prediction platforms that reportedly earned $2.4 million betting on U.S. military activity with a near-perfect success rate.
Lawmakers Push Safeguards And Limits
Sen. Richard Blumenthal, D-Conn., and Sen. Katie Britt, R-Ala., introduced the bipartisan GAME Act to restrict gambling ads aimed at minors. Other proposals would limit wagers, including political and war-related markets.
Blumenthal said, “Prediction markets need not be banned, but they need serious safeguards to stop the use of insider information, national security breaches, as well as market manipulation.”
The hearing will include representatives from traditional gambling companies and prediction platforms such as Kalshi and Crypto.com, with lawmakers questioning fairness standards.
Regulation Disputes Intensify
A separate Senate Commerce Committee hearing highlighted concerns about cheating allegations, youth-targeted advertising, and whether prediction markets could undermine state- and tribal-regulated gaming systems.
Sen. Ted Cruz, R-Texas, pointed to multiple incidents across professional sports involving alleged manipulation and insider information. He warned that such cases “sow doubt in the minds of fans,” highlighting concerns about public trust in sporting outcomes.
Advertising practices also drew criticism. Sen. John Hickenlooper, D-Colo., accused firms in the sector of aggressive marketing strategies that he said were directed at vulnerable users.
Harry Levant of the Public Health Advocacy Institute said unregulated advertising is worsening harm among problem gamblers.
Jurisdiction Fight Continues
At the center of the broader debate is disagreement over regulatory authority. Prediction market firms maintain they fall under federal oversight through the Commodity Futures Trading Commission, while several states continue to challenge that position. The resulting legal disputes over jurisdiction remain ongoing.
Industry representatives, including former lawmaker Patrick McHenry, argue that a unified national framework is needed. He pointed to existing safeguards such as age restrictions and internal controls within the sector.
Lawmakers remain divided on how prediction markets should be classified, weighing whether they function more like financial instruments or gambling products. As Congress continues its review, policymakers are attempting to balance innovation with consumer protection and long-standing concerns over gambling expansion.
Source:
“Congress targets online gambling boom, including sportsbooks and prediction markets”, komonews.com, May 19, 2026
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