Senators move to ban sports betting on prediction markets like Kalshi, Polymarket — first bill of its kind | Latest Tech News
A bipartisan Senate duo is introducing laws that would prohibit prediction markets like Kalshi and Polymarket from letting people wager on sports and casino-style video games.
The bill set to be launched Monday would bar any entity registered with the Commodity Futures Trading Commission from itemizing or facilitating transactions linked to sporting occasions or athletic competitions. It would also prohibit bets tied to casino-style video games, including poker and blackjack.
The laws, co-sponsored by Sens. Adam Schiff (D-Calif.) and John Curtis (R-Utah), marks the first Senate effort to handle the fast growth of sports-linked trading on platforms that operate exterior conventional state-regulated playing frameworks.
Sen. Adam Schiff (D-Calif.), pictured co-sponsored the bill with Sen. John Curtis (R-Utah). Getty Images
It comes after Arizona’s attorney common last week filed felony expenses against Kalshi accusing it of working an unlawful playing business.
The platform rejected the allegations as based on “paper-thin arguments.”
“States like Arizona want to individually regulate a nationwide financial exchange, and are trying every trick in the book to do it,” Kalshi fired back.
Sen. John Curtis (R-Utah) is introducing a joint bill on betting with Sen. Adam Schiff (D-Calif.). Getty Images
Last Thursday, Major League Baseball announced a new partnership with Polymarket and the CFTC to set up pointers aimed at managing risk while enhancing fan engagement.
Schiff took intention at jargon used by the prediction markets, which often refer to bets as “contracts.”
“Sports prediction contracts are sports bets — just with a different name,” he said in a assertion.
“And yet, these contracts have been offered in all fifty states in clear violation of state and federal law. Rather than enforce the law, the CFTC is greenlighting these markets and even promoting their growth. It’s time for Congress to step in.”
Kalshi said the bill would have hostile penalties.
Kalshi is a well-liked online betting outlet. SOPA Images/LightRocket via Getty Images
“Banning sports on regulated prediction markets would just push this behavior offshore, where no regulation exists,” spokesperson Elisabeth Diana told The Post in a assertion. “It’s clear this bill is motivated by casino interests that are threatened by competition.”
The CFTC didn’t immediately reply to a request for remark.
While sports betting is usually overseen at the state degree, prediction markets use financial devices such as futures and commodity contracts, putting them under federal jurisdiction. Recent months have seen lawmakers, state governments and federal regulators debate about who ought to have oversight of event and sports contracts on prediction platforms.
Prediction market Polymarket has seen fast growth in latest years. Bloomberg via Getty Images
Prediction markets have grown quickly in the US over the past yr, with trading volumes exceeding $1.2 billion during this yr’s Super Bowl and surpassing $4.5 billion for the week, according to industry estimates.
“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,” said Curtis.
The prediction markets sector has confronted elevated scrutiny this yr. Allegations of insider trading and issues over the use of the platforms relating to delicate geopolitical occasions like the January raid on Venezuela have raised regulatory and national security questions.
Both Kalshi and Polymarket have confronted criticism for permitting bets associated to the Iran struggle. Earlier this month, bettors on Polymarket allegedly made death threats to an Israeli reporter as they pressured him to change an article he wrote about an Iranian missile strike.
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