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State of Play’s TL;DR
- Mick Mulvaney has launched the “Gambling Is Not Investing” coalition to push for state and tribal regulation of prediction markets.
- This effort heightens a national fight over whether platforms like Kalshi and Polymarket are derivatives under federal law or simply gambling products that must follow state rules.
Former acting White House chief of staff Mick Mulvaney on March 3 launched an advocacy group called “Gambling Is Not Investing” to lobby for prediction markets to be regulated under state and tribal gambling laws.
Mulvaney, serving as the coalition’s executive director, said these platforms are being rebranded to avoid established consumer safeguards.
“Rebranding sports wagering as ‘trading’ or ‘investing’ or ‘predicting’ misleads consumers, undermines responsible gaming protections, and weakens the state and tribal systems built to protect the public and fund vital community services.”
Currently, the Commodity Futures Trading Commission (CFTC) oversees many prediction contracts because they are treated as derivatives that pay out on future-event outcomes. States and tribal coalitions have sued, arguing those platforms should instead fall under state gambling oversight.
Support for prediction markets comes from figures tied to the current administration (notably Donald Trump Jr. as an adviser and investor in Polymarket), and CFTC chair Mike Selig has pushed back at challengers.
“Let me be clear: We will see you in court.”
The dispute follows earlier enforcement by the prior CFTC leadership that accused Kalshi of resembling an “online casino.”
Some contracts could be removed
If Mulvaney and allied states prevail, US bettors could see major changes in how prediction platforms operate.
Under state and tribal rules, platforms may be required to obtain local licenses, implement stronger age verification and responsible gambling measures, and restrict or eliminate contracts on controversial topics (for example, war or political events) that many states already ban. That would likely mean more geoblocking, tighter identity checks, and potentially higher fees or taxes that could reduce payouts and liquidity.
For prediction market operators, a loss in federal pre-emption would raise compliance costs and fragment the market. Platforms might need separate approvals state-by-state or partner with licensed tribal operators.
Some operators could scale back US offerings or shift product design to align with gambling statutes, while others might litigate or seek federal legislative clarity.
Conversely, continued CFTC control preserves a single federal framework, which helps platforms operate across state lines and sustain liquidity – but leaves states arguing they lack tools to enforce consumer protections.
For players, the near-term effect is uncertainty. Expect changing terms of service, possible delisting of some markets, and closer scrutiny of account controls.
Based on reporting by Philip Conneller for Casino.org.
