The Indian Gaming Association (IGA) conducted a significant congressional briefing on Capitol Hill, raising alarms that sports event contracts through prediction markets represent a substantial threat to Indian gaming, as voiced by tribal leaders, the most notable since the Indian Gaming Regulatory Act (IGRA) was enacted.

Held in the Senate Committee on Indian Affairs meeting room, the briefing united tribal leaders, national and state gaming associations, and consumer protection specialists to discuss the swift growth of sports-related contracts operating under the regulation of the Commodity Futures Trading Commission (CFTC).

“The introduction of sports event contracts via prediction markets poses the largest risk to Indian gaming since IGRA was created to regulate it,” stated IGA Chairman Bean. “These are not pioneering financial instruments; they are unlawful sports betting products being funneled through futures exchanges to circumvent gaming laws. This constitutes a direct challenge to tribal sovereignty.”

Experts emphasized that the contracts, originally designed for managing risks in agriculture and other commodities, essentially operate as sports betting products while sidestepping gaming regulations.

“These are sports betting products. They resemble sports betting, they pay out just like sports betting. The only distinction lies in their disguise as financial swaps to escape regulation,” Bean remarked.

Panelists pointed out that, contrary to tribal and state-regulated sportsbooks, the platforms offering sports event contracts are devoid of geofencing measures, lack significant consumer protections, often depend on self-verified age checks, and do not share revenues with states or tribes.

Tribal leaders highlighted complaints lodged with the CFTC following the Super Bowl regarding disputed bets and outcome assessments, illustrating the need for regulatory clarity and protections typical of tribal gaming frameworks.

The tribal leader panel, overseen by IGA Executive Director Jason Giles, included Chief Kirk Francis of the Penobscot Nation and Councilwoman Hermenia Frias from the Pascua Yaqui Tribe. They articulated that gaming revenues support healthcare, housing, education, and public safety within their communities.

“Prediction markets yield no advantages for tribal communities,” Bean stated. “They siphon value without consent, compacts, or accountability.”

A distinct panel comprising representatives from tribal and commercial gaming groups, including the American Gaming Association, expressed what the organizers deemed a unified industry stance.

“The entire gaming sector, both commercial and tribal, stands united,” Bean asserted. “Tribal nations collaborate with states to eradicate this unlawful betting market. We urge Congress to intervene before irreparable harm is inflicted on state and tribal budgets and the livelihoods of our citizens.”

Tribal leaders also expressed worries over the CFTC’s position that such contracts are deemed legal under the Commodity Exchange Act. Recent remarks by CFTC Chair Michael Selig suggest a more active agency involvement in the ongoing legal issues surrounding prediction markets.

“Congress defined the gaming framework in this nation. If federal regulators re-interpret commodities law to permit nationwide sports betting, it undermines Congress, state and tribal entities, and the rule of law,” commented Bean.

The IGA and its affiliates are advocating for legislators to include clarifying language in forthcoming cryptocurrency marketplace legislations, affirming that the Commodity Exchange Act does not permit sports wagering through derivatives markets. Lawmakers were also encouraged to endorse a bipartisan letter to the CFTC regarding the agency’s recent remarks and advocate for enhanced scrutiny.

“Tribal gaming represents the most stringently regulated form of gaming in the United States. We have built this industry responsibly under IGRA, negotiated compacts, adhered to strict regulations, and shared revenues. What we are witnessing now is an attempt to circumvent all these efforts. Indian Country will not permit illegal gambling to undermine decades of progress and sovereignty,” Bean declared.

The Indian Gaming Association will continue to collaborate with tribal governments, gaming associations, and congressional members to advocate for the enforcement of federal laws and safeguard tribal rights.