Tribal Gaming Leaders Push Congress to Act Against Prediction Markets

Tribal gaming leaders are taking their fight against prediction markets to Capitol Hill, urging lawmakers to intervene before expanding event-based trading further reshapes the U.S. gambling landscape.

During a U.S. Senate Committee on Indian Affairs roundtable on August 4, representatives from several tribal organizations joined Ohio Solicitor General Mathura Sridharan in calling on Congress to clarify federal law and prevent prediction market operators from offering sports event contracts outside existing state and tribal gaming frameworks.

The discussion reflects the growing political battle surrounding platforms such as Kalshi and Polymarket, which continue to argue that their products fall under federal commodities law rather than state gambling regulations. Tribal leaders, however, warned senators that allowing those markets to expand unchecked could undermine decades of tribal gaming agreements and threaten a major source of economic development for Native American communities.

Tribal Leaders Say Prediction Markets Bypass Gaming Laws

Much of the hearing focused on whether sports event contracts differ in any meaningful way from traditional sports betting.

Speaking before the committee, Indian Gaming Association Vice Chairman Tehassi Hill argued that prediction market platforms are offering products that mirror licensed sportsbooks while avoiding the regulatory requirements imposed on tribal and commercial operators.

"They claim to be innovators, but they have invented nothing," Hill said during the hearing. He argued that prediction markets now offer many of the same products found at regulated sportsbooks, including moneylines, parlays, totals, and proposition-style wagers, while operating outside the licensing systems that govern sports betting across much of the United States.

Committee Vice Chair Sen. Brian Schatz (D-Hawaii) echoed that concern, questioning whether consumers see any practical difference between placing a wager through a sportsbook and purchasing an event contract through a prediction market platform.

For tribal leaders, that distinction is central to the ongoing debate. They argue that if the products function like sports betting, they should be regulated under the same state and tribal gaming laws rather than through federal commodities oversight.

Congress Faces Pressure to Clarify Federal Law

The Senate discussion also turned to the role of the Commodity Futures Trading Commission (CFTC), which currently oversees federally regulated prediction markets.

Several speakers criticized the agency's handling of sports event contracts, with particular attention given to the commission's current structure. The CFTC is designed to operate with five commissioners, but Chairman Michael Selig is currently its only serving commissioner, a situation several participants argued raises broader governance concerns.

Tribal representatives also criticized what they described as a lack of formal consultation between the CFTC and tribal governments before the agency advanced its proposed approach to prediction markets.

Mark Macarro, president of the National Congress of American Indians, said tribes whose economies depend heavily on gaming should have been included in discussions before federal regulators considered expanding event-based trading.

The hearing follows months of growing tension between tribal governments and prediction market operators, with tribes repeatedly warning that nationwide event contracts could erode the exclusivity agreements that underpin many tribal gaming compacts.

Lawmakers Urged to Protect Tribal Gaming Framework

Rather than relying solely on ongoing court cases, tribal leaders called on Congress to take legislative action.

Among the proposals discussed during the hearing was advancing the Prediction Markets Are Gambling Act, legislation that would prohibit sports betting and casino-style event contracts. Witnesses also urged lawmakers to ensure similar language is included in the proposed CLARITY Act, while asking Congress to clarify whether the Commodity Exchange Act was ever intended to cover sports-related event contracts.

Ohio Solicitor General Mathura Sridharan, whose office continues to challenge Kalshi in federal court, argued that the current legal uncertainty stems from a broader question that courts have yet to resolve.

According to Sridharan, lawmakers should first determine whether sports event contracts fall within the scope of the Commodity Exchange Act before addressing whether federal law preempts state gambling regulations. She also told senators that, if Congress ultimately decides to establish a federal framework, it should build upon the regulatory expertise states have developed over decades of licensing, consumer protection, responsible gaming, and integrity monitoring.

The Senate roundtable does not create new law, but it highlights how the debate over prediction markets is increasingly shifting from state courtrooms to Congress. As more states, tribal governments, and federal regulators weigh in, the industry's future may depend as much on legislative action as the outcome of the growing number of lawsuits surrounding event-based trading.

Stay tuned to UMG Gaming for more updates on prediction markets, trading platforms, and the latest developments shaping the future of event-based trading.