Senators Adam Schiff and John Curtis are introducing legislation to bar CFTC-regulated prediction market platforms from offering contracts tied to sporting events.
The bill represents the first bipartisan Senate effort to restrict prediction markets. It would also prohibit casino-style products such as slot machine games, video poker, blackjack, and bingo from appearing on the platforms.
Prediction Markets Face Congressional Pushback
Schiff framed the legislation as a response to what he called federal regulators actively enabling the sector’s expansion into sports.
“The CFTC is green-lighting these markets and even promoting their growth. It’s time for Congress to step in and eliminate this backdoor, which violates state consumer protections, intrudes upon tribal sovereignty, and offers no public revenue,” WSJ reported, citing Sen. Adam Schiff
Curtis, the bill’s Republican co-sponsor, pointed to youth exposure as a primary concern. He argued that addictive sports betting and casino-style contracts should fall under state control rather than federal regulators.
The bill directly affects Kalshi and Polymarket’s U.S. platform, both of which are regulated by the Commodity Futures Trading Commission (CFTC).
While these platforms offer yes-or-no contracts on topics from politics to weather, much of their trading activity centers on professional and college sports.
That focus puts them in direct competition with licensed sportsbooks like FanDuel and DraftKings.
MLB Deal Adds Friction to the Debate
The timing sharpens the clash. Just days before the bill’s introduction, Major League Baseball named Polymarket its exclusive prediction market exchange partner in a multiyear deal.
MLB Commissioner Rob Manfred and CFTC Chairman Michael Selig also signed an MOU, the first such agreement between a federal regulator and a professional sports league.
Under that arrangement, Polymarket gained exclusive access to MLB logos, official data from Sportradar, and promotional exposure across the league’s digital ecosystem.
Both parties agreed to restrict markets that could threaten game integrity, including contracts on individual pitches, manager decisions, and umpire performance.
However, the deal primarily covers Polymarket’s smaller U.S. exchange rather than its larger crypto-based international platform.
The MLB partnership arrived two days after Arizona filed criminal charges against Kalshi for allegedly operating an unlicensed gambling business.
More than 20 states have filed civil suits or issued cease-and-desist orders challenging whether prediction markets qualify as gambling under state law.
Federal vs. State Battle Intensifies
The proposed legislation deepens the jurisdictional standoff between state gambling regulators and the CFTC. Prediction market platforms argue their contracts are derivatives that fall under federal oversight.
Meanwhile, state regulators and the American Gaming Association disagree, insisting that sports-related contracts constitute gambling and fall under state and tribal authority.
The CFTC under its current leadership has taken a supportive posture toward prediction markets.
Selig previously called Arizona’s criminal prosecution of Kalshi “wholly inappropriate” and characterized it as a jurisdictional dispute.
Whether the bill advances or stalls, it signals that Congress is no longer content to let the CFTC and state regulators settle the question of prediction markets on their own.
The new Senate bill threatens the same sports category that MLB just validated with a multiyear commercial agreement.