Senate Push Targets Sports Betting on Prediction Markets

Lawmakers are preparing to restrict sports-style contracts on federally regulated platforms, escalating scrutiny as prediction markets surge in popularity and volume.

A new bipartisan effort in Washington could reshape one of crypto’s fastest growing niches. According to a Wall Street Journal report, U.S. senators Adam Schiff and John Curtis are preparing legislation that would ban sports and casino-style betting on federally regulated prediction markets.

The proposal would directly impact platforms overseen by the CFTC, including Kalshi and Polymarket’s U.S. operations, preventing them from offering contracts tied to sports events or games like poker and blackjack. Lawmakers argue these products blur the line between financial markets and gambling, while sidestepping state level protections and oversight.

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The move comes as legal pressure is already mounting. Several states, including Nevada and Arizona, have taken action against prediction market platforms, while others are pursuing lawsuits. At the same time, regulators and courts are still debating whether these contracts fall under federal derivatives law or state gambling rules.

Despite the scrutiny, the sector continues to grow rapidly, with rising volumes and reported valuations near $20 billion. This bill signals that regulation may be about to catch up.