Two US senators have introduced bipartisan legislation aimed at stopping prediction market platforms from offering contracts tied to sports events and casino-style games, as scrutiny intensifies around the sector.
Senators Adam Schiff of California and John Curtis of Utah presented the proposed law, titled the Prediction Markets Are Gambling Act, to restrict entities regulated by the Commodity Futures Trading Commission (CFTC) from listing contracts that resemble traditional betting products. The measure would amend federal law and clarify the boundary between federal oversight and state-level gambling regulation.
Lawmakers Target Gambling-Style Contracts
Supporters of the bill argue that prediction market offerings closely mirror sports betting, despite being structured as financial instruments. Schiff stated, “Sports prediction contracts are sports bets — just with a different name. And yet, these contracts have been offered in all fifty states in clear violation of state and federal law.” He added, “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.”
The legislation would prevent CFTC-registered platforms from listing agreements linked to sporting events or casino-style games. Curtis raised concerns about exposure to betting-style products, particularly among younger users. “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.”
Regulatory Disputes And Legal Challenges
The proposal comes amid disagreements over how prediction markets should be classified. Companies describe their offerings as financial contracts similar to commodity trading, while several states argue they amount to gambling.
Recent legal actions highlight the tension. In Arizona, prosecutors filed a 20-count complaint accusing one platform of accepting illegal bets on sports and elections. A Nevada court issued a temporary restraining order blocking similar offerings.
State officials have taken a firm stance in some cases. “Kalshi may brand itself as a ‘prediction market,’” Arizona Attorney General Kristin Mayes said in a statement, “but what it’s actually doing is running an illegal gambling operation and taking bets on Arizona elections, both of which violate Arizona law.”
Rapid Growth Draws Scrutiny
Prediction markets have seen a surge in activity, with contracts tied to major sporting events attracting large sums. A March Madness contract exceeded $100 million in trading, while Super Bowl-related trading surpassed $1 billion in 2026.
Industry participants continue to defend their model. Kalshi co-founder Tarek Mansour criticized the proposed legislation, writing that it was the “casino lobby hard at work. … Banning just pushes this offshore, where no regulation exists. This bill isn’t about protecting consumers; it’s about protecting monopolies.”
Companies have also introduced controls to address integrity concerns. One platform stated, “Individuals involved in college and professional sports (including athletes, personnel, and referees) will be preemptively blocked from trading markets associated with sports they are involved in.”
As lawmakers push for clearer rules, enforcement actions and policy debates continue to shape the future of prediction markets in the United States.
Source:
“NEWS: Sens. Schiff, Curtis Introduce Bipartisan Legislation to Ban Sports Prediction Market Contracts”, schiff.senate.gov, March 23, 2026
The post US Senators Move to Ban Sports Prediction Markets first appeared on RealMoneyAction.com.