Get 125% / $2,500 on 1st deposit!
New players only. Exclusive Welcome Bonus of up to $2,500
The American Gaming Association says sports prediction markets now create a major tax problem for states, tribes, and licensed gambling operators.
Good to Know
Prediction markets have spent months arguing that sports event contracts belong under federal commodities law. The American Gaming Association now wants state officials to look at the revenue side.
AGA President and CEO Bill Miller said platforms offering game outcome contracts may have already cost states and tribes up to $1 billion in gaming tax revenue. He framed the dispute as a public funding issue, not just a fight between sportsbooks and financial-market firms.
He said: “It’s about states and tribes that are losing literally a billion dollars today in state and tribal revenue that would otherwise go to fund important community projects.”
Licensed sportsbooks and casinos pay gambling taxes, licensing fees, and compliance costs in each state where they operate. Prediction market platforms argue their products are federally regulated event contracts, so they do not fit the same state gambling framework.
That gap has made Kalshi-style sports contracts a target for the AGA, tribal gaming groups, and state regulators. Their argument is simple enough: when a contract lets users trade on a game result, it looks too close to sports betting to avoid gaming rules.
The timing also matters. A CFTC proposal covering prediction market platforms, including names such as Kalshi and Polymarket, is now under White House Office of Management and Budget review. In January, CFTC Chairman Michael Selig dropped an earlier plan that would have blocked sports and political contracts, saying the agency would write new rules instead.
The CFTC has also argued in court and public statements that it holds authority over federally regulated prediction markets. President Donald Trump backed that view in a social media post and criticized Minnesota Gov. Tim Walz, Illinois Gov. JB Pritzker, New York Attorney General Letitia James, and former New Jersey Gov. Chris Christie.