Key Findings
- More than 15,000 Americans participated in a survey revealing that 81% consider purchasing sporting event contracts through prediction markets to be gambling
- Just 29% believe the CFTC possesses adequate authority to regulate sports event contracts effectively, while 49% lack confidence in prediction markets’ insider trading prevention measures
- A substantial 78% majority believes prediction market operators should face identical state taxation and licensing fees as traditional sportsbooks
- Multiple state governments have initiated legal proceedings against prediction market companies, with Nevada securing successful court rulings against both Kalshi and Coinbase
- Amid regulatory challenges, Kalshi allegedly processed approximately $800 million in trading volume during the opening weekend of NCAA Tournament competition, while major operators including DraftKings, FanDuel, and Fanatics have launched prediction market offerings
Recent polling data reveals an overwhelming public consensus that sports-focused prediction market contracts represent gambling rather than legitimate investment vehicles. Morning Consult administered the comprehensive survey, collecting responses from more than 15,000 participants during a six-day period spanning March 17 through March 22.
The survey received financial backing from Gambling is Not Investing, an advocacy group dedicated to blocking federally regulated exchanges from facilitating sports-related contracts. The findings indicate that 81% of survey participants classify the purchase of contracts based on sporting event outcomes as gambling activity.
Mick Mulvaney, who serves as Executive Director of Gambling is Not Investing and previously held the position of acting White House chief of staff, characterized the findings as validation of mounting public apprehension. He contends that prediction market platforms are effectively repackaging sports wagering products as financial investment instruments.
Merely 29% of survey respondents expressed confidence in the Commodity Futures Trading Commission’s capacity to appropriately oversee sports event contracts. The CFTC functions as the federal regulatory body with jurisdiction over prediction market operations.
CFTC chair Mike Selig, who received his nomination from President Trump and gained Senate confirmation in December, has emerged as a vocal advocate for permitting prediction markets to facilitate sports-related contract offerings. His position has generated significant pushback from state-level regulators and established gambling industry stakeholders.
Confidence Gap in Prediction Market Safeguards
The polling data revealed that 73% of participants believe terminology such as “event contracts,” “swaps,” or “futures” serves to mask the genuine financial risks facing traders. More than half of respondents indicated that purchasing sports events through prediction platforms presents equivalent risk levels to placing wagers through licensed sportsbook operators.
A mere 34% demonstrated confidence that prediction market platforms provide consumer protections matching those available through licensed sportsbooks. Nearly half of all respondents—49% specifically—reported minimal to zero confidence in these platforms’ capacity to detect and prevent insider trading activities.
An overwhelming 81% majority indicated that prediction markets should comply with state-level sports betting regulations, encompassing age verification requirements and responsible gambling protocols. Current prediction market operations permit participation by adults aged 18 and older, contrasting with most state jurisdictions that mandate sports bettors reach age 21.
Regarding taxation policy, 78% voiced agreement that prediction market operators should remit equivalent state taxes and licensing fees as traditional sportsbooks. Across most jurisdictions, sportsbooks face taxation on gross revenue, whereas prediction markets generate income through commission fees assessed on transactions between buyers and sellers.
Industry critics maintain that prediction markets’ deployment of market makers to ensure liquidity renders them operationally indistinguishable from conventional sportsbooks.
Legal Challenges and Legislative Initiatives Multiply
Numerous state governments have pursued litigation against prediction market operators. Nevada has secured favorable court decisions that prohibit Kalshi and Coinbase from facilitating contracts connected to sports competitions, entertainment events, and political outcomes.
Massachusetts achieved a temporary restraining order targeting Kalshi, effectively barring the company from marketing sporting event contracts to state residents.
Federal lawmakers have introduced bipartisan legislation designed to constrain prediction market activities. U.S. Senators John Curtis and Adam Schiff jointly sponsor proposed legislation that would ban prediction markets from offering products that resemble sports betting or casino gaming operations.
Curtis framed the legislative proposal as a matter of preserving state sovereignty, safeguarding American families, and preventing speculative financial instruments from entering inappropriate market segments.
Notwithstanding this regulatory resistance, prediction markets continue experiencing substantial growth. Industry reports from the previous week suggested Kalshi facilitated over $800 million in trading volume exclusively during the NCAA Tournament’s opening weekend.
DraftKings, FanDuel, and Fanatics have each launched prediction market operations. These platforms enable sports contract offerings in populous states including California, Georgia, and Texas, where sports betting legislation remains unapproved.
DraftKings CEO Jason Robins described prediction markets as “a massive incremental opportunity” during the company’s latest quarterly earnings presentation. He projected the company anticipates generating hundreds of millions in annual revenue from its predictions platform within the next several years.
