Kalshi, Polymarket and the Coalition for Prediction Markets have spent at least $3 million this year on lobbying and campaign contributions across the federal and state levels as they fight growing efforts by states to regulate prediction markets, according to OpenSecrets, Stateline reports.
The platforms argue they operate like federally regulated commodity markets, while many state officials contend they function as sports betting and should be subject to state gambling regulations, taxes and consumer protections.
Kalshi, the largest prediction market platform, has hired at least one lobbyist in 41 states and contributed more than $300,000 combined to organizations supporting Republican and Democratic attorneys general, as well as $250,000 to the Republican and Democratic governors’ associations. Kalshi also spent nearly $1 million on federal lobbying during the first half of the year, focusing on the Commodity Futures Trading Commission, White House, Securities and Exchange Commission and Congress.
The dispute has prompted state legislation, regulatory actions and lawsuits involving states, prediction markets and the CFTC, which has defended its authority over the industry and sued nine states that attempted to regulate prediction markets. The five-member CFTC currently has four vacancies.
With litigation continuing, observers cited by OpenSecrets expect the U.S. Supreme Court could ultimately determine the extent of state authority over prediction markets. The legal outcome could affect whether the platforms must comply with varying state gambling laws, potentially creating significant implications for their business models.
