Prediction markets are booming, and there is no denying that with the advent of sporting event contracts, the gambling industry has been hesitant about what the future would bring. Both Polymarket and Kalshi have elicited funding in the millions in the very least, although the former did receive a $2bn cash bonus from NYSE’s owner just last week.
Sporting event contracts keep G2E delegates on their toes
It is in this context that industry dignitaries gathered at the Global Gaming Expo in Las Vegas last week to address the rising competition from the prediction market segment.
However, the topic was not about fair competition, with industry people, and American Gaming Association CEO Bill Miller warning about the advance of these platforms that do not necessarily meet the same rigorous standards for sports betting.
AGA and industry members argue that prediction markets avoid gambling laws but offer virtually the same product. Kalshi’s boss, Tarek Monsour, has argued that this is not true and that prediction markets are simply a superior product to traditional gambling.
What’s more, Monsour has rebuffed claims that companies such as his skirt gambling laws, arguing that Kalshi is regulated under the CFTC. Yet, prediction markets are having a direct impact on the dominance of sports gambling.
"The AGA and our members are mobilizing across every battlefield. They’re threatening the communities we serve, the customers and consumers we protect, and the standards we uphold," Miller said, pointing out to the legal opposition that has mushroomed against prediction markets, with multiple states across the nation attacking prediction markets.
Opposition to alternative forms of gambling that resemble the legacy model but are not regulated under the same demanding framework has been the cause of other legal fights and opposition. In California, for example, Gov. Gavin Newsom signed AB 831 into law, outlawing sweepstakes casinos, effective January 1, 2026.
Prediction markets are still a very small part of the whole
Miller did not hesitate to describe companies that offer a variety of products – such as skill games, sporting event contracts, or sweepstakes – as "illegal" and argue that they are simply trying to "blur the lines" between gambling and what they purport isn’t quite the same thing.
According to AGA’s survey, however, 85% of people seem to agree that sporting event contracts are indeed a form of gambling. The survey also showed "strong support" for regulating sporting event contracts the same way betting companies are.
With numerous developments over the past weeks, prediction markets are definitely not going anywhere. They may not even come to dominate the sports betting market, but they would erode its operational capacity.
While the future is unclear, the gambling industry is aware of the fact that sporting event contracts remain an issue that needs to be addressed. The industry’s strategy so far is to question the legitimacy of prediction markets when they involve sports betting.
