A new bipartisan bill introduced Monday by Senators Adam Schiff (D-CA) and John Curtis (R-UT) could dramatically reshape the fast-growing world of prediction markets by blocking platforms such as Kalshi and Polymarket from offering sports-related wagering and casino-style games.
If passed, the legislation would target “sports prediction contracts,” a product that looks and feels like sports betting but is offered through federally regulated prediction-market platforms. Importantly, the bill would not change the rules for major online sportsbooks like FanDuel and DraftKings, which operate under state-by-state gambling frameworks rather than a federal regulator.
Schiff argues the distinction between a “prediction contract” and a sports bet is mostly semantics. In his view, these offerings function as sports wagering, and allowing them nationwide effectively sidesteps the patchwork of state gambling laws that traditional sportsbooks must follow. Supporters of the bill say that’s the core issue: prediction markets can reach users in all 50 states under a federal regulatory structure, while sports betting is typically limited to states that have explicitly legalized it.
The proposal arrives as gambling becomes increasingly embedded in American life. Since a 2018 Supreme Court decision opened the door for states to legalize sports betting, the market has exploded. Total sports wagers climbed from $4.9 billion in 2017 to $121.1 billion in 2023, reflecting rapid expansion in apps, advertising, and mainstream acceptance. Professional sports leagues have also leaned into the industry through partnerships with betting companies, even as high-profile cases involving athletes and alleged illegal activity keep concerns about gambling’s darker side in the spotlight.
Under current rules, platforms like Kalshi and Polymarket fall under the oversight of the Commodity Futures Trading Commission (CFTC), which is why federal lawmakers can seek changes at the national level rather than relying on individual states to act. Schiff and Curtis say that, in practice, there’s little difference between placing a wager on a state-regulated sportsbook and buying a sports-linked contract on a federally regulated prediction market.
Kalshi’s recent growth is fueling the debate. The company’s Super Bowl-related trading volume reportedly topped $1 billion this year, representing a year-over-year increase of about 2700%. To critics, that surge is evidence that sports betting is being repackaged and scaled quickly under a different label.
Curtis, meanwhile, is emphasizing the impact on younger users and the risks tied to gambling addiction. He argues that sports betting-style products and casino-like contracts should remain under state control, where lawmakers and regulators can tailor restrictions, consumer protections, and enforcement to local standards.
Those addiction concerns are backed by research trends. Analysts at the University of California San Diego’s Qualcomm Institute and School of Medicine examined online search behavior and found that when online sportsbooks became available, searches seeking help for gambling addiction rose by 61% and continued increasing over time—suggesting expanded access may be linked to rising demand for support.
Kalshi is pushing back. A company spokesperson said the bill would reduce competition and drive users toward offshore prediction markets, while also suggesting the effort is influenced by established casino interests that don’t want new competitors entering the space. Polymarket did not provide a response.
The scrutiny around Kalshi is also growing beyond Congress. The platform is currently temporarily banned in Nevada and is facing criminal charges in Arizona, adding legal pressure as policymakers debate how prediction markets should—and shouldn’t—operate in the United States.
For consumers, the stakes are straightforward: this bill could determine whether sports wagering through prediction-market apps remains broadly accessible nationwide or gets restricted in ways that align more closely with the state-by-state rules governing traditional sports betting.
