There aren’t too many things done in a bipartisan way these days in Washington.

But Prediction Markets regulation seems to be one of them.

Prediction Markets Are Gambling Act

A bill introduced Monday to the US Senate co-sponsored by Senators John Curtis (R-Utah) and Adam Schiff (D-California) called the Prediction Markets Are Gambling Act effectively was designed to prohibit Commodity Futures Trading Commission (CFTC) registered entities from listing any prediction contract that resembles a sports bet, or casino-style game.

Sports – 90% of Kalshi business

If passed, the legislation would put a major dent into the business models of Prediction Markets operators such as Kalshi and Polymarket, as well as those financial brokers offering sports related Prediction Markets trading to their retail clients, such as Robinhood. Sports event contracts make up an estimated 90% of Kalshi’s business, and have been one of the fastest growth areas for Robinhood.

The CFTC, which regulates US derivatives markets, recently reasserted its jurisdiction over Prediction Markets, and just last week entered into an agreement with Major League Baseball on Prediction Markets, to protect the integrity of professional baseball and the relating Prediction Markets.

Senator statements

Senator Adam Schiff released some statements on his website page (schiff.senate.gov) stating,

“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. Rather than enforce the law, the CFTC is greenlighting these markets and even promoting their growth. 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. I’m proud to partner with Senator Curtis to put a stop to these illegal markets.”

“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,” said Senator Curtis. “Our bipartisan legislation clarifies regulatory jurisdiction, ensuring that states can maintain their authority over sports betting and casino gaming. The Prediction Markets Are Gambling Act is about respecting states’ authority, protecting families, and keeping speculative financial products out of spaces where they don’t belong.”

Indistinguishable from gambling

Currently, as noted above CFTC-registered entities such as Kalshi and Polymarket offer a wide range of sports prediction contracts, that the Senators said are indistinguishable from gambling. Over the past year, sports prediction contracts have rapidly proliferated with next to no oversight or regulation from the CFTC. Prediction market platforms currently list sports contracts with tens of millions of dollars in trading volume: for example, a March Madness winner contract already has more than $100 million in trading volume, while Super Bowl trading volume on prediction markets surpassed $1 billion in 2026.

According to the introduced legislation, Prediction Markets contracts are listed in all 50 states, including states that have restrictions or prohibitions on sports betting. These contracts evade state and tribal consumer protections, generate no public revenue, and undermine sovereign tribal regulatory regimes. These contracts are also offered in states where gambling is restricted or illegal. In California, most forms of gambling are prohibited within the state under the state constitution, including casino-style gaming and sports betting. In Utah, state law prohibits all forms of gambling.

CFTC reversed course

For fifteen years, the CFTC has enforced its authority to prohibit the listing of a contract that involves, relates to, or references, “gaming.” However, the Senators stated that the CFTC and its Chair have abruptly reversed course, intervening in ongoing litigation and proceeding with rulemaking to significantly relax the CFTC’s enforcement of this clause. Now, the CFTC is entering into partnerships with entities like Major League Baseball to further facilitate these markets’ growth.

The Prediction Markets Are Gambling Act would prohibit any CFTC registered entity from listing a contract that closely resembles a sports bet or a casino-style game, reinforces Congress’ original intent that the Commodity Exchange Act does not permit sports gambling, and removes any ambiguity in the statute.