Less than one-third feel CFTC can properly regulate sporting event contracts; 78% say taxes should be the same as state-licensed sportsbooks
A recent survey found that more than 4-in-5 Americans believe people who buy contracts on sporting events, such as the NCAA Tournament, through prediction markets participate in gambling.
That’s one of several takeaways from the Gambling is Not Investing poll, which the organization that seeks to prevent the federally regulated online exchanges from offering such contracts hired Morning Consult to conduct earlier this month. Gambling Insider obtained a copy of the survey results over the weekend.
“This polling confirms that unabated sports gambling on prediction markets is a growing concern across America,” said Mick Mulvaney, Executive Director of Gambling is Not Investing. “Prediction markets are trying to disguise their sports betting products as a financial investment, misleading Americans and dodging consumer safeguards like age requirements.
Let’s face it, if it quacks like a duck, it’s sports betting.”
Prediction markets have been offering sports betting contracts for more than a year, coinciding with the beginning of the second Trump Administration. (Mulvaney, a former South Carolina congressman, served as acting chief of staff for more than a year during Trump’s first term.)
President Trump nominated Mike Selig to run the Commodity Futures Trading Commission, which is the federal agency that oversees prediction markets. Since the Senate confirmed him in December, Selig has become an ardent supporter of prediction markets offering sports-related contracts.
Only 29% of survey respondents believe the CFTC can effectively regulate sports event contracts.
Voters Not Confident Prediction Markets Protect Traders
Morning Consult conducted its poll online from March 17-22, netting more than 15,000 responses with a plus/minus 1% margin of error.
When told that prediction markets allow people to invest in the outcome of a sporting event, 81% said it was gambling, and 73% said the use of terms like “event contracts,” “swaps,” or “futures” obscures the financial risks for traders.
More than half, 56%, said that buying sports events on prediction market platforms carries the same amount of risk as making a wager at a state-licensed sportsbook.
However, only 34% are either very or somewhat confident that prediction market platforms offer protections comparable to licensed sportsbooks. Further, nearly half, 49%, expressed little or no trust in prediction markets’ ability to stop insider trading.
In addition, 81% feel to some degree that prediction markets should abide by state sports betting regulations, including age restrictions and responsible gambling provisions.
Prediction markets, like other federally regulated accounts, allow adults as young as 18 to participate. Most states require individuals to be 21 before they can participate in sports betting.
Further, 78% agree to some extent that prediction market operators should pay the same state taxes and fees as sportsbooks.
In most states, sports betting operators that accept wagers from patrons pay taxes on the revenue they generate. Prediction market operators facilitate trades between buyers and sellers and charge a commission. However, several prediction markets work with market makers to provide liquidity for various contract opportunities, including sports events. Critics of prediction markets argue the use of such market makers make them no different than a sportsbook.
Interest Rising in Prediction Markets, Legislation
The survey comes as several states, both those that have legalized sports betting and those that have not, have since filed suit against prediction market operators.
The states argue that they have the right to regulate gaming activities. Nevada has court wins over Kalshi and Coinbase from offering contracts on anything tied to sports, entertainment and politics. Massachusetts also won a temporary restraining order against Kalshi, precluding them from soliciting sporting event contracts in the state.
In addition, numerous lawmakers on Capitol Hill, both Democrats and Republicans, have introduced bills to stop the expansion of prediction markets into sports and to ban insider trading. U.S. Sens. John Curtis (R-Utah) and Adam Schiff (D-Calif.) are behind a measure that would prohibit prediction markets from offering anything resembling sports betting or anything found at a casino.
Our bipartisan legislation clarifies regulatory jurisdiction, ensuring that states can maintain their authority over sports betting and casino gaming,” Curtis said. “The Prediction Markets Are Gambling Act is about respecting states’ authority, protecting families, and keeping speculative financial products out of spaces where they don’t belong.”
However, despite the groundswell of opposition, prediction markets are capturing interest nationwide. Reports circulated late last week that Kalshi executed more than $800 million in trades during the first weekend of the NCAA Tournament.
“WOW!!! That is incredible,” New Jersey gaming attorney and lobbyist Bill Pascrell III posted on X. “Time to sit down & compromise.”
In addition, DraftKings, FanDuel, and Fanatics, three top state-licensed sportsbooks, have also jumped on the prediction market bandwagon. Prediction markets enable them to offer sports in states like California, Georgia, and Texas, the three most populous states without legalized sports betting.
DraftKings co-founder and CEO Jason Robins touted prediction markets as “a massive incremental opportunity” during the company’s quarterly earnings call last month.
“We are targeting hundreds of millions in annual revenue for DraftKings predictions in the years ahead,” he said. “We believe there is much more upside over the long term. This should translate to meaningful, incremental, adjusted EBITDA. In predictions, we have the playbook to execute and win.
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