The crackdown on sweepstakes operators in California and other US jurisdictions is increasingly viewed by tribal leaders and gaming executives as preparation for a broader dispute involving prediction markets. That view emerged during the Indian Gaming Association Tradeshow & Convention in San Diego, where attendees said enforcement efforts are shaping the next phase of gaming regulation.
California tribes helped drive 2025 legislation targeting sweepstakes platforms that replicated online casino products. The law is seen as a turning point that influenced similar actions in other states. California tribal gaming generated $12 billion in 2025, funding healthcare and community services, with leaders warning that revenue loss to unregulated operators directly affects those programs.
Industry Unity and Early Lessons
Executives said the sweepstakes outcome showed the impact of coordinated action across the sector. Howard Glaser, head of government affairs for Light & Wonder, said alignment among stakeholders proved decisive.
“It shows that when the industry is on the same page they can accomplish just about anything,” Howard Glaser said of the victory over sweepstakes. “After California, all of the dominos fell. This was the existential threat we talked about last year and it’s not that threat today. Sweeps was a test run and warm up for the prediction market threat this year. Next year it will be something else. There’s always new technology and someone looking to invade gambling laws to the detriment of the industry.”
California’s law extended liability beyond operators to include platforms, payment processors, and marketing partners. Michael Hoenig of the Yuhaaviatam of San Manuel Nation said other states have adopted similar approaches.
Prediction Markets Face Legal Challenges
Unlike sweepstakes operators, prediction market firms are actively challenging regulators in court. Hoenig said companies are filing pre-emptive lawsuits and signaling they intend to stay in contested markets.
Shawn Fluharty of Play’n Go and the West Virginia legislature said sweepstakes operators rarely fought in court, while prediction platforms such as Kalshi and Polymarket now directly challenge state enforcement.
Attention has also expanded to sportsbook operators. Dan Little of the San Manuel Nation said companies like DraftKings have entered prediction-style offerings, increasing competitive pressure in regulated markets.
Market Expansion and Outlook
Despite enforcement efforts, Glaser said strong consumer demand continues to fuel both sweepstakes and prediction markets. He noted limited legal online gaming options in the US are pushing activity toward alternative platforms.
“There are scarce legal opportunities in the U.S right now to satisfy that demand,” Glaser said. “Igaming is legal in only seven jurisdictions, but the demand for online gaming exists in 50 states. That’s the fuel and oxygen for prediction markets and sweeps. The real policy question, for the tribes especially, is what to do when you can provide online gaming technologically and the marketing money is there. As you’re fighting the good fight, don’t lose sight of the big picture, which is where the tribes are at for online gaming, to help tamp down this consumer demand.”
Rocha said tribal leaders remain cautious but confident, while legal disputes are expected to take years to resolve.
Source:
“IGA: Sweepstakes fight prepares tribes and gaming operators for battle against prediction markets”, cdcgaming.com, April 14, 2026
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