ICE: Tribal leaders and American Gaming Association confront prediction markets issue
Leaders of the Indian Gaming Association and the American Gaming Association confronted the threat posed by prediction markets in a session at ICE 2026 in Barcelona on Tuesday.
Referring to the breadth of events contracts being traded, American Gaming Association Vice President of Government Relations Tres York said the prediction markets were contributing to a sense of the “gamblefication of everything”, remarking that it had “the potential to have some very negative impacts on society.”
York said there was a stark contrast between the sports betting market’s identity as a strictly regulated form of entertainment and what he perceives as the prediction markets’ attempts to tout themselves as a source of income for their users.
“When the United States Supreme Court overturned PASPA in 2018, it gave the states the ability to make the determination on whether or not they wanted to legalize sports betting,” he said. “Responsible gaming has been the backbone of a thriving sports betting market in the United States. If you don’t have customers that are very responsible, you don’t have a sustainable marketplace.”
In contrast, he said, “The messaging and the advertising from the prediction markets folks – especially on the sports side of things – is this is a financial tool. This should be integrated into your investment portfolio.”
Indian Gaming Association Chairman David Bean echoed York’s sentiments, saying the tribal gaming industry would not have become the US$49 billion industry it is today without the founding principle of strong regulation.
“This prediction market issue is a violation of tribal law, state law and federal law,” he said. “And so, our responsibility is to tell our story, to educate members of Congress, to educate these agencies who are not taking action.”
Bean also raised concerns over insider trading and use of crypto on prediction platforms. He said crypto had the ability to obfuscate source of funds and know-your-customer requirements, while recent trades, such as those related to Venezuelan President Nicolás Maduro on January 3, showed signs of being placed by people with inside information.
“That undermines the confidence that consumers have, and should have, in placing a bet with the respective entity that they’re betting with,” he said.
Finally, Indian Gaming Association Executive Chairman Jason Giles addressed the position of sportsbooks, such as DraftKings and FanDuel, who have chosen to pursue prediction markets activity alongside their traditional sports betting businesses.
“None of these guys have so much reached out and even thought about what they’re doing,” he said. “And they just come in and want to take over a market. And it’s really disturbing to see, if tribes are partnered with sports books, and now they’re going to get into this space.
“You know, everyone needs to start reevaluating their positions and their relationships with these guys. I know that the AGA has had to do that, and Indian country is going
to have to do that.”
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The Backstory
How prediction markets became a flash point
Prediction markets moved from industry curiosity to political fight as major platforms began offering contracts that resemble sports bets but operate under a different legal framework. Tribes and commercial operators initially treated the products as fringe finance. That changed when event contracts spread from elections and macro data to sports, parlays and college portals, and when the largest consumer brokerages began distributing them to mass audiences.
In California, tribal leaders say the platforms, not daily fantasy, are the immediate threat to sovereignty and revenue. They argue the products amount to sports wagering delivered through a loophole that bypasses state gaming laws. Three tribes sued Robinhood and Kalshi in federal court, seeking to block what they call unauthorized sports betting on tribal lands and across the state. The companies counter that event contracts are financial instruments set by market prices, not wagers, and warned of “substantial and irreparable harm” if an injunction is granted. A hearing is set for Oct. 23 in San Francisco, underscoring how fast the dispute has moved from policy debate to litigation. For background, see California’s tribal gaming leaders target prediction market apps.
Volume growth has magnified the stakes. Kalshi launched its first sports contract in January and reported hundreds of millions in handle during marquee events, while a partnership put Robinhood’s distribution muscle behind NFL and college football markets. Tribal leaders argue that even limited availability could siphon traffic from regulated sportsbooks and compacted tribal operations, weakening the revenue that funds services such as health care and education.
States and tribes test federal boundaries
The dispute centers on jurisdiction and risk. Prediction markets operate under federal derivatives rules overseen by the Commodity Futures Trading Commission. Sportsbooks are licensed state by state with strict responsible gaming standards, age verification and advertising controls. As event contracts proliferated, state regulators and attorneys general moved to assert authority, issuing cease-and-desist orders and challenging whether the products are lawful within their borders.
Tribal nations have taken a front-line role. A coalition filed a legal brief backing the Ho-Chunk Nation’s effort to block Kalshi and Robinhood from offering contracts on tribal land. They frame the issue as existential: gaming revenues underwrite core services and economic development, and products that mirror betting but skip established oversight put those systems at risk. The brief aligns tribes with state regulators in asserting that federal permissibility for derivatives cannot nullify state and tribal gambling laws. Read more in Native American tribes back Ho-Chunk Nation fight against Kalshi, Robinhood.
Kalshi has responded with countersuits arguing states are overreaching to block federally regulated markets. That posture sets up a clash between federal market structure and state gambling regimes, with tribal sovereignty layered on top. The outcome will shape whether prediction markets can operate nationally with one set of rules or face a patchwork resembling sports betting’s state-by-state map.
Big sportsbooks split from industry’s main lobby
The politics shifted when leading sportsbooks chose prediction markets for themselves. DraftKings and FanDuel launched offerings and then left the American Gaming Association, the sector’s most influential trade group. The AGA opposes the spread of prediction markets, saying the products are indistinguishable from sports betting but regulated as derivatives, creating uneven standards and consumer risks.
The exits signal diverging strategies inside legal gaming. Sportsbooks see new revenue and user engagement, powered by financial-market distribution and lower regulatory friction. The AGA is pushing for uniform rules that keep sports outcomes under gaming regulators rather than commodities law. The trade group has also weighed a resolution to exclude prediction market operators from membership, reflecting a hardening line.
The departures matter because they strip the lobby of two of its most visible members while preserving their alignment on some shared goals through other coalitions. It also raises questions for tribal-sportsbook partnerships if partners expand into event contracts that tribes view as encroaching on compacts and state law. Details are in DraftKings, FanDuel confirm departure from American Gaming Association.
Congress becomes the next arena
With state actions and lawsuits proliferating, industry groups are pressing Washington to clarify boundaries. The American Gaming Association and the Indian Gaming Association sent a joint letter to Congress arguing sports event contracts are essentially sports bets and urging lawmakers to prevent gaming from migrating into commodities markets via regulatory inaction. They cite the rapid evolution from single-game outcomes to parlays and potential markets tied to college athlete movements as evidence of mission creep.
The letter also uses recent controversy around geopolitical bets to spotlight risks like insider trading and inadequate know-your-customer standards when crypto and opaque funding enter the mix. The trade groups want Congress to address cryptocurrency market structure and reinforce that sports outcomes fall under gaming law, not derivatives, to avoid backdoor expansion. CFTC leadership has signaled it will follow congressional direction if lawmakers step in, which places the onus on Capitol Hill to draw jurisdictional lines. See AGA and IGA urge Congress to address sports event contracts.
Federal action could settle core questions: whether event contracts on sports are permissible derivatives or prohibited gaming, what consumer protections apply, and how to police insider information in markets that trade on real-world outcomes. It would also determine whether tribes and states retain control over sports-related wagering within their borders or must adapt to a federally preempted framework.
Global echoes of sovereignty and harm reduction
The clash over prediction markets reverberates beyond the United States. In New Zealand, tribal leaders are urging a pause on plans to auction online casino licenses, arguing that offshore operators could deepen harm without reciprocal obligations to communities or Treaty commitments. The call highlights a shared theme with U.S. tribes: when gambling shifts online and crosses borders, traditional compacts and community safeguards can be diluted unless the rules are set first. More in New Zealand tribal leaders call for pause to online gambling changes.
That international perspective underscores why the U.S. debate is urgent. If prediction markets continue to scale under financial regulation, they could outflank state and tribal systems designed for responsible gambling, tax capture and local oversight. If lawmakers restrict them too broadly, innovation could shift offshore or underground. The path chosen will influence where money flows, who sets the rules and how consumers are protected.
What began as a technical distinction between a bet and a derivative has become a test of regulatory architecture. Tribes see the products as an end run around sovereignty and compacts. States view them as unlicensed wagering. Some sportsbooks see an opportunity to grow. Congress is being asked to decide whether sports outcomes belong in the betting book or the order book, and the answer will shape the balance of power in U.S. gambling for years.
