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WASHINGTON – Lawmakers, Native American tribes, consumer advocates and others are voicing strong opposition to the Trump administration’s plans to regulate sports and other wagering in the booming prediction market industry, according to a review of public comments available on Monday.
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The comments representing a spectrum of views are in response to last month’s proposal from the U.S. Commodity Futures Trading Commission that would set moral boundaries for some prediction markets – which allow users to place yes/no wagers on such things as sports, elections, economic outcomes and Wall Street indices, among other events.
The CFTC is proposing to limit certain types of bets on a set of activities identified in the law, including crime, terrorism, assassination, war or “gaming,” saying some of these may fall outside of the “public interest,” while generally allowing sports wagering on platforms such as Kalshi and Polymarket to continue.
Representatives from Kalshi and Polymarket did not immediately respond to requests for comment on Monday.
President Donald Trump and his administration have embraced the prediction markets industry generally, fighting court battles across the country to argue that federal law allows registered markets to offer trade in derivatives known as event contracts and that no state authority may interfere with this.
Under last month’s proposal, prediction markets based on scores, win-loss results and tournament advancement would likely be acceptable, while markets based on player injury, fighting, children’s sports and refereeing likely would not.
However, Christopher Dodd, the former Democratic U.S. senator who co-sponsored the landmark 2010 statute that gave the CFTC regulatory authority over derivative contracts known as swaps, said lawmakers at the time had never intended to make that agency the nation’s gambling regulator.
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“At the time Congress passed Dodd-Frank, we were well aware of existing federal laws regulating gaming,” he wrote. “We had no intention of amending those laws.”
Likewise, former CFTC Chairman Timothy Massad said in a letter that the CFTC “has lost its way.”
“Although I have not submitted comments on any rule proposal since leaving the agency, I feel it is important to do so here because the agency has lost sight of its mission and the limits of its own authority,” Massad said.
Native American tribes, traditional casinos and local authorities in 20 states argue that sports wagering on prediction markets amounts to illegal gambling that should be under the control of local authorities. Sports prediction markets are blocked in places such as Nevada and Michigan.
The CFTC faces no timeline for issuing any final proposal but considers the comments received.
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(Reporting by Douglas Gillison in Washington; Editing by Stephen Coates)
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