Americans Say Prediction Markets Should Be Regulated, AGA Research Finds

According to a report by the American Gaming Association (AGA), research shows strong public support for regulating sports event contracts offered through prediction markets, similarly to other forms of legal, state-regulated sports betting.

Americans Say Prediction Markets Should Be Regulated by State Authorities

YouGov conducted an online survey on behalf of the AGA from August 1 to 8, polling a nationally representative sample of 2,025 registered voters. The margin of error is ±2 percentage points, with a larger margin for subgroups. According to the findings, 85% of Americans believe sports event contracts are most similar to gambling, while just 6% view them as resembling financial instruments. This strong sentiment is fueling public support for tighter oversight and regulation of these platforms.

A significant majority of 80% say that sports event contracts should be regulated in the same way as other forms of online sports betting. Additionally, 65% believe oversight should fall under state and tribal gaming regulators, not the federal Commodity Futures Trading Commission (CFTC), which currently oversees commodities and financial derivatives.

The survey also found that 84% of Americans and 69% of current sports bettors think sports event contracts should only be available through state-licensed sportsbooks operating legally within each state. Moreover, 69% agree that individual states should have the authority to determine whether these types of contracts can be offered within their borders.

Public concern extends to the legality of current prediction platforms offering sports event contracts. About 70% of respondents believe these platforms are exploiting legal loopholes to function as unlicensed sportsbooks, operating outside the regulatory frameworks established for legal sports betting.

AGA Pushes for More Regulation

AGA president and CEO Bill Miller emphasized that the research clearly shows Americans can recognize a sports bet when they see one. Additionally, they expect prediction markets offering sports event contracts to follow the same rules and consumer protections as state-regulated sportsbooks. He emphasized that the findings underscore the importance of the CFTC enforcing its own regulations prohibiting gaming contracts. Miller also urged Congress to utilize its oversight authority to prevent prediction markets from serving as a backdoor for unregulated gambling.

AGA argues that its research highlights the importance of consistent regulation for emerging gaming products to protect consumers and ensure responsible gaming practices are upheld. And while some, like DraftKings’ CEO argue that sportsbooks have an advantage over prediction markets, companies involved in the latter activity seem to rely on a loophole in regulations. Operators such as Kalshi and Polymarket rely on this to offer products that look like sports wagers without being regulated as traditional sportsbooks. 

However, considering the AGA’s findings, these activities might soon come under more scrutiny from regulatory bodies.