Published on: January 13, 2026, at 12:19 PM.
Updated on: January 13, 2026, at 12:42 PM.
- Gaming industry organizations assert that sports event contracts resemble legitimate sports betting
- They allege that the prediction markets sector is exploiting regulatory inaction by the CFTC
The American Gaming Association (AGA) and the Indian Gaming Association (IGA) are calling upon Congress to take decisive action regarding sports event contracts, which they argue are indistinguishable from traditional sports bets.
In a formal letter directed to House and Senate members, both gaming organizations assert that operators of prediction markets are taking advantage of the CFTC’s inaction, which harms state gambling regulations and tribal rights. They suggest that Congress can utilize cryptocurrency legislation as a means to more effectively regulate prediction markets nationwide.
“We firmly believe that the upcoming discussions on cryptocurrency market regulations present a significant bipartisan chance to prevent sports betting and casino gambling disguised as ‘event contracts,’” the letter states.
The AGA and IGA also criticized the self-certification practices that enable prediction market operators to launch numerous new sports event contracts with minimal regulatory oversight. These derivatives can be accessed by anyone aged 18 and older, posing risks to state and tribal revenue streams, as stated by the associations.
Tribal Concerns Over Prediction Markets
Tribal casino operators have increasingly voiced their objections to sports event contracts, as many have exclusivity agreements in their respective states, meaning that any expansion of wagering must involve them.
Last month, the IGA pointed out that neither the Commodity Exchange Act (CEA) nor the CFTC, which oversees companies like Kalshi and Polymarket, provides any protections for event contract vendors attempting to conduct sports betting in states where expansion is governed by tribal regulations.
“A coalition of 39 state Attorneys General notes that these contracts are in violation of their state laws. They infringe upon the Indian Gaming Regulatory Act (IGRA), which grants tribes exclusive rights to provide gaming services on their territories. Sports event contracts also contravene the federal Wire Act, which prohibits offering sports bets across state lines,” the AGA and IGA emphasized in their communication.
The trade groups also highlighted that prediction markets are profiting from contracts related to tragic events, such as assassinations and conflicts, which would not be permissible under state and tribal regulations.
Concerns About Misleading Sports Contracts
Football event contracts have generated significant engagement for prediction market operators, leading some companies to initiate campaigns to persuade critics that their activities extend beyond simply sports betting.
While public opinion will ultimately determine the narrative, it is evident that the AGA and IGA are urging Congress to intervene, believing that sports event contracts mislead both bettors and investors while exposing various other vulnerabilities.
“These sports event contracts mislead consumers into perceiving that they are investing in sports bets, neglect to protect vulnerable populations, and pave the way for issues such as money laundering, match fixing, and insider trading,” the trade associations concluded. “They undermine state budgets and tribal finances while compelling states and tribes to allocate substantial legal resources to safeguard their sovereignty.”