Key Points
- A bipartisan Senate measure known as the Prediction Markets Are Gambling Act seeks to prohibit athletic and casino-based contracts on platforms including Kalshi and Polymarket
- Companies regulated by the CFTC would be forbidden from offering contracts related to sports competitions or traditional casino gaming
- The proposal targets specific contract types rather than shutting down prediction platforms completely
- The bill joins several other 2026 congressional proposals focused on regulating prediction market activities, including the BETS OFF Act
- Additional legislative efforts address age verification requirements, promotional restrictions, and prohibitions on government officials participating in these markets
On March 23, a collaborative legislative effort emerged in the U.S. Senate targeting prediction market platforms and their ability to offer contracts based on athletic events and traditional casino gaming.
Titled the Prediction Markets Are Gambling Act, the legislation comes from Senators Adam Schiff representing California and John Curtis from Utah.
This marks a notable development as the first bipartisan Senate initiative specifically designed to regulate prediction market operations.
Schiff characterized the issue plainly during the bill’s introduction: “Sports prediction contracts are sports bets, just with a different name.” He emphasized that such offerings exist “currently offered in all fifty states in clear violation of state and federal law.”
Key Provisions of the Proposed Legislation
The bill would implement a comprehensive prohibition for CFTC-regulated entities, preventing them from listing any contracts connected to athletic events. Casino-style gaming activities including poker, blackjack, roulette, and slot machines would also fall under the restriction.
Services such as Kalshi and Polymarket stand among those that would face limitations under the new framework. These platforms have experienced significant growth and user expansion in recent times.
Rather than eliminating prediction platforms altogether, the legislation takes a targeted approach by restricting specific contract categories that overlap with state gambling regulations.
According to Schiff, the measure addresses “respecting states’ authority, protecting families, and keeping speculative financial products out of spaces where they don’t belong.”
The California senator further contended the proposal would safeguard tribal sovereignty while eliminating what he characterized as regulatory loopholes that bypass state consumer safeguards.
Proponents argue the legislation serves as a preventive measure against prediction markets evolving into online gambling establishments.
Congressional Attention Increases on Prediction Markets
Multiple legislative initiatives have emerged targeting prediction platforms throughout 2026, with the Prediction Markets Are Gambling Act representing just one component of this regulatory push.
Senator Chris Murphy alongside Representative Greg Casar unveiled the BETS OFF Act in early March, focusing on a different category of contracts.
Their proposal specifically addresses contracts involving government and military operations. Concerns arose after participants generated profits from geopolitical developments, such as coordinated military operations by the U.S. and Israel targeting Iran and the kidnapping of Venezuelan leader Nicolas Maduro.
The BETS OFF Act would prohibit wagering on governmental decisions, acts of terrorism, military conflicts, political assassinations, and scenarios where participants could directly affect outcomes. The legislation also includes provisions to disconnect payment processing for offshore platforms and establish criminal consequences for U.S.-based promoters and operators.
Senator Richard Blumenthal has advanced consumer protection measures specific to prediction markets, incorporating mandatory age verification processes and restrictions on promotional activities.
A distinct legislative effort from Senators Jeff Merkley and Amy Klobuchar aims to prevent elected officials from earning profits through prediction market participation. Rahm Emanuel has introduced comparable restrictions extending to federal workers and their immediate family members.
This proliferation of legislative proposals demonstrates heightened congressional scrutiny of the prediction market sector throughout 2026.
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