U.S. Tribal Casinos Say Revenue Hit by Prediction Market Platform Kalshi

The U.S. Commodity Futures Trading Commission (CFTC) is set to meet with representatives of Native American tribal gaming operations on May 29 amid growing concern over the impact of platforms like Kalshi that offer betting on the outcomes of sports and current events, according to Gambling News.

Tribal communities argue that the federal legalization of prediction markets could create serious challenges. 

They say such a move would undermine tribal sovereignty over gambling activity within their reservations, where Native-owned casinos operate under sovereign gaming rights. Moreover, tribes report that services like Kalshi are already siphoning off revenue from their gaming operations.

The California Nations Indian Gaming Association has previously urged the CFTC to declare that prediction markets fall outside the scope of permitted activity under current U.S. law. For its part, Kalshi maintains that its operations fall under CFTC jurisdiction and are fully compliant with federal regulations.

Beyond tribal concerns, the growing popularity of prediction platforms has triggered pushback from state gambling regulators. Gaming commissions in Illinois, Ohio, Nevada, New Jersey, and Maryland have issued formal warnings to Kalshi, Robinhood, and Crypto.com, stating that their platforms violate state laws due to operating without proper gaming licenses.

The regulatory tension has escalated into legal proceedings. Kalshi is currently facing a lawsuit in Nevada, where the court has allowed the platform to continue offering sports markets at least until the case is resolved. Legal experts suggest Kalshi has a strong chance of prevailing in court.