A bipartisan pair of U.S. senators unveiled plans Monday for legislation that would bar American prediction-market platforms from offering sports-related wagers — a move that could reshape a fast-growing corner of the crypto and derivatives world.
What’s proposed
- Senators Adam Schiff (D‑CA) and John Curtis (R‑UT) plan to introduce a bill that would prohibit any Commodity Futures Trading Commission (CFTC)‑registered entity from listing contracts that “resemble a sports bet or casino‑style game.”
- The measure aims to reaffirm Congress’ original intent that the Commodity Exchange Act does not permit sports gambling and to keep sports betting regulation at the state and tribal level.
Why it matters to crypto markets
- Leading prediction-market platforms such as Polymarket and Kalshi have been offering event‑tied contracts — including many sports markets — and have argued they fall under federal oversight by the CFTC rather than state gambling laws.
- Backers of the bill say those markets are effectively unlicensed sports betting in another form and should be subject to state gambling rules. Opponents say a federal approach is appropriate and that state bans would push activity offshore.
Reactions and stakes
- John Curtis said the bill responds to concerns about “addictive sports betting and casino-style gaming contracts” being accessible to young people, particularly in Utah.
- The Indian Gaming Association’s chair, David Bean, backed the proposal, saying it would protect tribal and state authority to regulate or prohibit sports betting and help protect consumers and sports integrity.
- Kalshi pushed back, telling Decrypt the bill “is motivated by casino interests” and would protect U.S. casinos’ monopolies while driving markets offshore.
Legal backdrop
- Over the past year, multiple states have sued prediction-market platforms seeking to apply state gambling laws to sports-related markets; judges have so far been mixed in accepting platforms’ CFTC‑jurisdiction arguments.
- Nevada last week became the first state to successfully obtain a temporary ban on Kalshi while its lawsuit proceeds to trial. Arizona also filed criminal charges against Kalshi recently, alleging illegal gambling operations and unlicensed election wagering.
- The Trump‑era CFTC, led by Chair Mike Selig, has backed prediction‑market firms in the jurisdictional fight and pledged agency resources to defend them; the broader dispute could ultimately reach the U.S. Supreme Court.
Political pressure
- The states challenging the CFTC’s interpretation cross party lines, from Massachusetts to Tennessee. Utah Gov. Spencer Cox (R) has criticized the CFTC’s stance, saying the platforms are harming families.
- Rep. Alexandria Ocasio‑Cortez (D‑NY) also publicly condemned pervasive gambling, calling it socially destructive and addictive.
What’s next
- The bill is expected to be formally introduced Monday. If enacted, it would prevent CFTC‑registered platforms in the U.S. from listing sports and casino‑style contracts, pushing the industry toward either state‑regulated frameworks or offshore options — and likely accelerating the legal battle over who has authority to regulate event‑tied markets.
Editor’s note: story updated after publication to include comment from the Indian Gaming Association.
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