Lawmakers Move to Ban Sports Betting Contracts on Prediction Markets

According to WSJ, U.S. Senators Adam Schiff and John Curtis are preparing to introduce bipartisan legislation that would prohibit platforms regulated by the Commodity Futures Trading Commission (CFTC) from offering contracts tied to sporting events. The proposed bill is expected to directly affect prediction-market platforms such as Kalshi and the U.S. version of Polymarket, where much of the trading activity currently centers on professional and college sports outcomes.

The legislation aims to block CFTC regulated entities from listing contracts that resemble sports wagers, a move lawmakers say is necessary to maintain consistency with existing gambling regulations.

Concerns Over Consumer Protection and Gambling Rules

Supporters of the bill argue that prediction markets offering sports-related contracts function similarly to sports betting but without being subject to the same state-level consumer protection laws. Senator Adam Schiff stated that these markets act as a “backdoor” around established gambling rules and consumer safeguards.

Lawmakers also raised concerns about the impact on tribal sovereignty and the absence of public tax revenue typically generated through regulated sports betting frameworks. The proposal reflects growing scrutiny of prediction markets as their popularity expands and their offerings increasingly resemble traditional wagering models.

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