- A former Trump official launched a coalition arguing prediction market platforms are illegal sports betting in disguise.
- Not all Republicans are aligned, with the CFTC backing the platforms while prominent party figures push for state-level regulation instead.
- States are already taking these platforms to court, with legal experts expecting the Supreme Court to ultimately decide the outcome.
WASHINGTON D.C. – Mick Mulvaney has won poker tournaments in Las Vegas, fought to bring legal sports betting to South Carolina, and spent a career moving through the highest levels of American government. When he identifies something as gambling, that assessment carries some weight.
This week, the former acting chief of staff at the White House under President Trump is relying heavily on that history as the leader of a recently established organization called Gambling Is Not Investing. The group is advocating for state gambling legislation to govern prediction market platforms such as Kalshi, Polymarket, and Robinhood instead of federal regulation.
The coalition alleges that, despite being marketed under a different name, sports-focused event contracts are essentially the same as conventional sports wagers.
A Republican Party Divided
A growing divide within the Republican Party has been revealed by the introduction of Gambling Is Not Investing. Mike Selig, the CFTC chair chosen by Trump, has supported the platforms, arguing that they operate as federally regulated derivatives markets rather than state-licensed gambling businesses. Selig has stated that he is ready to defend that stance in court, and the agency has already done so by filing legal documents in favor of Crypto.com in the midst of a Nevada lawsuit.
Republicans, on the other hand, are starting to disagree. Gov. Spencer Cox of Utah has declared prediction markets to be gambling in public and promised to use every resource at his office to stop them. Chris Christie, the former governor of New Jersey, is largely in agreement.
Mulvaney’s coalition, which includes organizations like Moms for America and Consumer Action for a Strong Economy, contends that these platforms are subtly undermining the legal foundation that US sports betting states have established over many years through their own legislative procedures.
Prediction markets, according to the group, are providing legal sports betting options without abiding by the consumer safeguards and responsible gaming regulations that those state systems were designed to uphold.
With millions of users purchasing event contracts on outcomes ranging from elections to sporting events, prediction market apps have become increasingly popular. State regulators nationwide have taken note, and a number of them have filed lawsuits to prevent these sites from functioning inside their borders.
