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The American Gaming Association (AGA) and Indian Gaming Association (IGA) are calling on Congress to intervene as crypto-based prediction markets launch a new wave of sports betting type contractsclaiming these products could circumvent and weaken state and tribal gaming laws.
In a joint letter sent to lawmakers in both chambers, both groups requested that the issue be addressed as part of cryptocurrency legislation currently under consideration in Congress.
“We write to call on Congress to act in a timely manner to address the explosion of unregulated activity. sporting event contracts being offered by prediction markets,” the groups wrote.
Today, the AGA and the Indian Gaming Association sent a letter urging Congress to use cryptocurrency market structure legislation to end nationwide sports betting disguised as “event contracts.”
Read the letter
https://t.co/iUZ3qSgw4T
– American Gaming Association (@AmericanGaming) January 12, 2026
The groups say these contracts look and act a lot like traditional sports betting, but they are offered outside of the rules that licensed sportsbooks must follow. What started early last year as simple bets on who would win a match has since evolved into more complicated options, including parlays and even contracts tied to where players might end up.
“Since these contracts, which are indistinguishable from legal sports betting, were launched last January, their trading volume has grown exponentially and expanded beyond the outcome of single games to include complex bets and even potential bets on the college transfer portal,” the letter states.
The groups also argue that prediction market platforms registered with the Commodity Futures Trading Commission are taking advantage of weak enforcement to push the limits of what they are allowed to offer.
“This growth has occurred by exploiting regulatory inaction by the Commodity Futures Trading Commission (CFTC), which undermines state laws and tribal sovereignty and runs counter to existing federal laws and regulations intended to protect consumers and the integrity of our nation’s financial markets,” they wrote.
Video gaming groups call on Congress to crack down on crypto prediction markets
They say Congress now has the opportunity to intervene by imposing limits on these products in crypto market legislation currently underway on Capitol Hill.
“We strongly believe that Congress’s consideration of cryptocurrency market structure legislation provides an important bipartisan opportunity to prevent sports betting and casino gaming under the guise of ‘event contracts,’” the groups said.
The AGA and IGA say regulated gaming companies must follow a long list of rules designed to protect consumers, while prediction market platforms face far fewer limits, ranging from lower age requirements to looser compliance standards. They argue this allows platforms to circumvent state and tribal authority and avoid paying taxes that help support public services.
In their letter, the groups also claim that these contracts violate a series of federal and state laws, including the Commodity Exchange Act, the Indian Gaming Regulatory Act and the Wire Act. They point out that several state attorneys general have already said the platforms were operating illegally.
They also warn that prediction markets are starting to move into more sensitive territories, including betting related to foreign conflicts and political figures.
“More recently, questions and concerns have been raised regarding contracts related to the capture of Venezuelan President Nicolas Maduro and ongoing armed conflicts abroad – categories that would never be permitted under state or tribal law,” the letter said.
The groups have warned that the platforms blurring the line between gambling and investing while exposing consumers to serious risks.
“These contracts are offered in blatant disregard of state laws, tribal sovereignty, the Commodity Exchange Act, and CFTC regulations,” the letter said, adding that they “mislead consumers into believing that a sports bet is an investment, fail to protect the young and most vulnerable, open the door to money laundering, match fixing, and insider trading.”
The letter also cited comments from Michael Selig, Chairman of the CFTC during his confirmation hearing, saying he would defer to Congress while related lawsuits were pending.
“At his confirmation hearing, Chairman Selig made clear that the CFTC would not put the brakes on sports betting contracts under his leadership, instead deferring to the outcome of litigation that could take years to fully resolve,” the groups wrote. “However, Mr. Selig also said that the CFTC would follow Congress if it intervened and spoke out on these contracts.”
The organizations urged lawmakers to explicitly ban gambling-style contracts on CFTC-regulated platforms.
“Therefore, it is critical that Congress act quickly to include legislative language in cryptocurrency market structure legislation that strengthens existing law and prohibits gaming through CFTC-registered platforms,” the letter states.
The letter was signed by Bill Miller, president and CEO of the American Gaming Association, and David Z. Bean, president of the Indian Gaming Association.
Featured image: American Gaming Association / Indian Gaming Association
The position AGA and Indian Gaming Association Urge Congress to Curb Crypto Prediction Markets That Threaten Gambling appeared first on ReadWrite.
