Sens. John Curtis (R-UT) and Adam Schiff (D-CA) introduced bipartisan legislation on March 23 to ban Commodity Futures Trading Commission (CFTC)-regulated prediction markets from listing sports-related and casino-style event contracts. The proposed legislation is the latest in a growing list of bills seeking to rein in prediction markets amid increased scrutiny of these platforms on Capitol Hill.
The Prediction Markets Are Gambling Act would amend the Commodity Exchange Act (CEA) to bar registered entities from offering contracts on sporting events, athletic competitions, or casino-style games. If the bill passes, it would make clear that states have full authority over sports betting and casino-style gambling.
The legislation comes as sports contracts remain one of the biggest sticking points in the debate over the legality of prediction markets. State regulators, tribal stakeholders, industry groups, and some lawmakers have argued that sports event contracts are indistinguishable from sports betting and are a loophole that allows CFTC-regulated platforms to circumvent state law and operate in states where traditional sports wagering is restricted or illegal.
Redefining Rules of the Game
As written, the bill would settle the debate over whether event contracts are “hedging” tools or just digital wagers. The legislation would amend the CEA to explicitly define and ban contracts related to “sporting events or athletic competitions” and “casino-style games,” which include everything from slot machine games to professional and collegiate sports.
Speaking about the proposed legislation, Curtis put it in terms of state authority and consumer protection:
“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. Our bipartisan legislation clarifies regulatory jurisdiction, ensuring that states can maintain their authority over sports betting and casino gaming.”
Schiff took a more direct shot at the current structure of prediction markets, arguing that “sports prediction contracts are sports bets — just with a different name.” He said the products are being offered nationwide “in clear violation of state and federal law” and described the measure as a way to close a regulatory “backdoor” that intrudes on state consumer protections and tribal sovereignty.
Capitol Hill Pressure on Prediction Markets Keeps Building
The Prediction Markets Are Gambling Act is just the latest in a wave of recent legislation targeting prediction markets, an industry that Schiff described as the “Wild West” when he introduced the DEATH BETS Act on March 11.
Beyond sports and casino-style gaming, Congress is taking aim at prediction markets on multiple fronts, as it looks to tighten the screws on these platforms:
- Political Integrity: Rep. Ritchie Torres (D-NY) introduced the Public Integrity in Financial Prediction Markets Act, which would ban federal officials from trading on government-related contracts if they possess nonpublic information.
- The “Death Bets” Ban: Senator Schiff also recently introduced the DEATH BETS Act, which specifically prohibits contracts tied to war, assassinations, or individual deaths.
- Consumer Protections: The Prediction Markets Security and Integrity Act, sponsored by Sen. Richard Blumenthal (D-CT) and Sen. Andy Kim (D-NJ), proposes a broader regulatory framework, including age verification and a ban on using credit cards for wagers.
As prediction markets gain traction, lawmakers on Capitol Hill are making clear they intend to shape how the industry moves forward.
