A bipartisan House bill would bar CFTC-registered trading platforms from offering event contracts tied to sports or casino-style games, in a fresh push to draw a line between prediction markets and gambling. Representatives Steven Horsford of Nevada and Mark Amodei introduced the Prediction Markets Are Gambling Act on 23 July, and companion Senate legislation was filed in March by Adam Schiff, John Curtis and Catherine Cortez Masto.
In the lawmakers’ release, the measure was cast as a way to close a federal loophole that lets companies bypass state licensing, consumer protections, tax obligations and the oversight that legal gaming operators face. Horsford said the fight was about protecting jobs, consumers and the integrity of Nevada’s gaming industry, while Amodei said gaming policy belongs to states and tribes, not federal regulators.
The Senate text would amend the Commodity Exchange Act to prohibit agreements, contracts or transactions linked to sporting events, athletic competitions or casino-style games from being listed or made available for clearing or trading on a registered entity. It defines casino-style games to include slots, video poker, blackjack, roulette, craps, table games, bingo and lottery, and says the ban would not pre-empt state law.
A Congressional Research Service briefing described prediction markets as exchange platforms that offer binary event contracts whose prices move as users buy and sell them. It said such prices can carry information about the probability of an event, that these markets were historically tightly constrained by the CFTC, and that litigation and a changing regulatory posture helped push consumer-facing contracts into politics and sports. By February, roughly 87% of Kalshi’s $39.7 billion in traded volume over the previous year was on sports, while sports accounted for 38% of Polymarket’s $36.2 billion.
The briefing said Kalshi runs a CFTC-regulated exchange, while Polymarket’s largest exchange is offshore and says it blocks U.S. users, though it also owns a smaller CFTC-approved exchange for U.S. customers. It said the difference creates distinct regulatory exposure and raises questions of regulatory arbitrage, especially because event contracts are generally available to 18-year-olds while legalized sports gambling is generally limited to those 21 and older.
The wider dispute has also turned on the CFTC’s authority and capacity. The service said the agency claims exclusive jurisdiction over derivatives markets, that several states are challenging those conclusions in court, and that a July hearing before the House Agriculture Committee focused on whether the CFTC has enough operational bandwidth to police sports-linked products. The Commodity Exchange Act lets registered derivatives exchanges self-certify new products rather than wait for prior CFTC approval, and the agency withdrew a June 2024 proposed rule and a September 2025 staff advisory in February before issuing a new staff advisory in March requiring contracts not to be readily susceptible to manipulation and exchanges to conduct real-time monitoring.
The bill has also drawn support from the American Gaming Association and labor leaders, who frame prediction markets as backdoor sports betting that strips tax revenue and threatens casino jobs. Bill Miller said the measure reinforced congressional intent that gaming is governed by state and tribal law, while UNITE HERE’s Gwen Mills said more than 100,000 members could be affected and Culinary Union Secretary-Treasurer Ted Pappageorge said 60,000 Nevada casino workers were at risk.
