The US gambling lobby has declared war on crypto prediction markets: bets under fire
The largest U.S. gambling associations — AGA, IGA, and AGEM — have united in an open letter to the Senate demanding a ban on sports prediction markets. Their target is a new cryptocurrency regulation bill currently under discussion. Essentially, this is a direct attack on the fast-growing segment of decentralized betting, which, according to lobbyists, operates outside the legal framework.
The main argument of the gambling industry: platforms like Kalshi and Polymarket disguise gambling as financial instruments. In doing so, they circumvent local laws, taxes, and consumer protection standards. The letter emphasizes that the Commodity Futures Trading Commission (CFTC) simply lacks the resources to oversee this segment. "Congress must clearly state: sports betting is not within the CFTC's jurisdiction and cannot be offered through prediction markets," the appeal states.
Numbers Pressuring Regulators
The scale of the threat to traditional betting is impressive. In May, trading volume on Kalshi reached $16.8 billion, and on Polymarket — $7 billion. These are no longer niche platforms but full-fledged competitors to legal bookmakers. Lobbyists are demanding that a ban be included in the CLARITY Act bill, which previously passed a key vote in the Senate Banking Committee.
Interestingly, pressure on prediction markets is mounting not only in the U.S. Notably, Indonesia's Ministry of Communications has already blocked access to Polymarket, equating it to online casinos. This is a global trend: regulators increasingly see crypto betting as a threat to the traditional gambling industry and the tax base.
My analysis: The situation resembles a classic conflict between innovation and established interests. Blockchain-based prediction markets are not just betting but a powerful tool for risk hedging and information gathering. A complete ban will slow down technological development, but the gambling industry's lobbying power is too strong to ignore. In the coming months, we can expect a fierce battle for the future of this sector in the U.S.