TheBlock
The American Gaming Association, the Indian Gaming Association, and the Association of Gaming Equipment Manufacturers are pressing the Senate to embed an explicit ban on sports and casino-style prediction markets in the Clarity Act, the chamber's main crypto market-structure vehicle. In a letter obtained by Semafor, the groups argue that prediction platforms have "fueled the largest expansion of gambling" in U.S. history and are reaching young users without the consumer protections state and tribal regulators require.
The ask lands as prediction markets have moved from niche to mainstream. Kalshi posted $16.81 billion in May trading volume, up from $14.81 billion in April, while Polymarket booked $7.08 billion — down from $9.01 billion the month prior. Senators Adam Schiff and John Curtis introduced the Prediction Markets Are Gambling Act in March to bar sports and casino-style contracts from registered platforms entirely.
Why it matters
The letter reframes the prediction-market debate as a jurisdictional question, not a product one. The groups argue the CFTC "lacks both the expertise and the infrastructure to police nationwide sports betting" and that sports wagering falls outside the agency's remit. That puts the gaming lobby in direct opposition to the CFTC itself, which has spent the last several months suing Wisconsin, Illinois, Arizona, Connecticut, New York, and New Mexico to defend its authority over sports-related contracts — and last week proposed a rule set that would explicitly support those markets while carving out bets on terrorism, assassinations, and war.
The Clarity Act, which the Senate Banking Committee advanced last month, is the most realistic vehicle for settling the question. If the gaming industry's language is added on the Senate floor, sports prediction markets would be functionally pushed back into the state and tribal regulatory system that has handled sports betting since 2018.
Market impact
For Kalshi and Polymarket, the volume trajectory is the immediate financial story — Kalshi's monthly run-rate is up double digits sequentially, even as Polymarket has cooled.
Frequently asked questions
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What is the gaming industry asking the Senate to do?
The American Gaming Association, the Indian Gaming Association, and the Association of Gaming Equipment Manufacturers want language added to the Clarity Act that would explicitly ban sports and casino-style prediction markets, arguing the CFTC is not built to regulate gambling.
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Why is the CFTC involved in sports prediction markets?
Prediction-market platforms Kalshi and Polymarket are registered with the CFTC and offer sports-related event contracts as federally regulated products. The agency has sued Wisconsin, Illinois, Arizona, Connecticut, New York, and New Mexico to defend that jurisdiction and last week proposed rules supporting sports…
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What is the Clarity Act?
The Clarity Act is the Senate's primary crypto market-structure bill. The Senate Banking Committee advanced it last month, and it now awaits a vote by the full Senate — the next major hurdle before it can move to the House.
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How big are prediction markets right now?
Kalshi recorded $16.81 billion in May volume, up from $14.81 billion in April, while Polymarket posted $7.08 billion, down from $9.01 billion the month prior, according to The Block's data dashboard.
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What happens to Kalshi and Polymarket if sports markets are banned?
A carve-out would block the fastest-growing user-acquisition channel — sports contracts — but would not touch election or financial-event contracts, the bulk of CFTC-cleared product. Platforms would likely refocus on political and economic event markets or face state-by-state sportsbook regulation.
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