Published on: December 11, 2025, 02:26h.
Updated on: December 10, 2025, 01:54h.
- Prediction markets are dominating discussions within the legal gaming sector
- Kalshi and rival firms assert that state gaming regulations do not pertain to prediction markets, including sports-related contracts
No topic looms larger in the United States’ legal gaming industry than prediction markets. These contentious online trading platforms allow users to buy and sell binary yes/no wagers on a wide array of topics, ranging from weather forecasts to geopolitical events like peace negotiations between Ukraine and Russia, potentially causing concern for legislators and regulators across the nation.
Platforms like Kalshi, Crypto.com, Polymarket, and Robinhood argue that they operate within the bounds of derivative trading. Backed by licenses from the US Commodity Futures Trading Commission (CFTC), they claim that state gaming laws do not apply.
As federal court cases are underway to evaluate these assertions, with Casino.org’s Todd Shriber noting that the Supreme Court may soon become involved, established betting companies such as DraftKings, FanDuel, and Fanatics are actively pursuing entry into the prediction market arena.
State gaming authorities have cautioned sportsbooks that participating in prediction markets with sports event contracts contravenes existing laws and should be approached with caution. However, the ongoing investments by leading sportsbooks in these emerging platforms hint at their belief that the legal environment will favor prediction markets.
Prediction markets enjoy a notable ally in former President Donald Trump. His media venture, Trump Media & Technology Group, is preparing to launch Truth Predict, a platform for prediction markets that will integrate with Trump’s Truth Social network.
Global Expansion of Prediction Markets
Based in New York, Kalshi is the predominant player in US prediction markets, while Polymarket, another New York-based crypto platform, leads in other regions. Kalshi aims for global outreach, recently announcing its liquidity pool, which now extends to over 140 countries.
Although Canada, the UK, and Australia have prohibited Kalshi’s operations, many countries have yet to impose similar restrictions.
Kalshi operates globally, engaging users in more than 140 nations. This expansion is set to create a consolidated liquidity pool for prediction markets, a model unique to Kalshi,” the company stated.
“Unlike other platforms that work with fragmented, region-specific markets, Kalshi’s global exchange allows traders from different locales to interact over the same events, enhancing liquidity and aiding price discovery across every market,” added Kalshi.
“Prediction markets possess universal appeal, as events transcend borders and so does trading on them. From elections to economic decisions, sports events, and climate change, individuals worldwide can directly trade on outcomes that influence their lives,” Kalshi asserted.
Are US Sports Prediction Markets at Risk of a Ban?
Regulators, attorneys general, and lawmakers are persistently exploring avenues to terminate sports prediction markets within their jurisdictions. Nonetheless, bettors on platforms like Polymarket remain largely unconcerned due to the current federal legal framework.
“Will any U.S. state implement a ban on sports prediction markets in 2025?” is a question posed on Polymarket. Trading indicates a mere 22% likelihood.
For the outcome to qualify as “yes,” it must be established that “sports event contracts listed by a CFTC-regulated Designated Contract Market, whether accessed directly or through a Futures Commission Merchant, are legally prohibited or barred for users in at least one U.S. state or nationwide” by December 31, 2025, at 11:59 PM ET.