Tribal gaming exclusivity faces ‘existential menace’ as prediction markets increase

A quick-growing class of on-line prediction markets is colliding with tribal gaming sovereignty, elevating alarms in Indian Country over what tribal consultants warn might grow to be an “existential threat” to tribal gaming exclusivity. 

The battle facilities on whether or not prediction-market platforms are successfully providing sports activities betting whereas sidestepping the compacts, licensing necessities and regulatory oversight that govern tribal gaming underneath federal legislation. What started as a restricted set of authorized challenges has widened right into a broader dispute over who has the authority to manage on-line wagering — and the place that authority stops. 

The dispute sharpened in January, when a Massachusetts courtroom moved to dam the prediction-market app Kalshi from providing sports-related contracts within the state, discovering that just about 70% of its buying and selling quantity was tied to sports activities bets.  

Patrice Kunesh, a visiting professor on the University of New Mexico School of Law and a senior fellow on the Brookings Institution, mentioned the prediction market platforms are increasing quickly by working outdoors the regulatory framework that governs tribal gaming, aided by aggressive on-line advertising and marketing.

Patrice Kunesh, a visiting professor on the University of New Mexico School of Law and senior fellow on the Brookings Institution, warns that prediction markets working outdoors tribal compacts might depart the Indian Gaming Regulatory Act “for naught.”Tribal cellular gaming is tightly regulated, together with by geofencing that limits play primarily based on a consumer’s bodily location. Kalshi faces no comparable restrictions, permitting anybody over 18 to take part nationwide — a disparity Kunesh mentioned offers the platform a structural benefit over tribal operators.

“[Kalshi is] ubiquitous, right, everywhere, all the time, no boundaries,” Kunesh advised Tribal Business News. “The entire Indian Gaming Regulatory Act could be for naught if Kalshi is allowed to rough ride all over tribal compacts and regulations.”

Tribes have pursued digital gaming with uneven outcomes, in response to prior Tribal Business News reporting. In Florida, tribal cellular betting has confronted a number of and sometimes protracted authorized challenges. Elsewhere, tribes have launched tightly regulated cellular choices together with a geofenced digital sportsbook operated by Navajo Nation Gaming Enterprises — with sturdy outcomes. 

In a Brookings Institution report, Kunesh warned that the dearth of boundaries fueling the prediction market platforms’ progress additionally raises authorized, financial and social‑welfare considerations. Lower age thresholds and frictionless entry, she wrote, take away guard rails that tribal operations have in place to discourage playing dependancy.

“It’s very addicting,” she advised Tribal Business News. “Online gaming, e‑gaming, i‑gaming — it has this very addicting quality and basically no regulation around it.”

Tribes have responded with litigation. Sixteen tribes and the Indian Gaming Association filed an amicus transient in Connecticut supporting state regulators who ordered Kalshi, Robinhood and Crypto.com to halt unlicensed on-line playing, according to Decrypt.

Decrypt studies that the tribes mentioned Kalshi has acted as if “Congress gave it permission to enter Indian lands and siphon gaming revenues away from tribes over such tribes’ objections.”

Three California tribes additionally sued Kalshi in 2025, arguing its sports-linked contracts violate IGRA by functioning as unlicensed sports activities betting accessible on tribal lands. The case stays energetic after a decide declined to problem an injunction.

The tribes’ authorized challenges activate a battle between IGRA and the Commodity Exchange Act, which governs derivatives — contracts whose worth is tied to the end result of an occasion and controlled by the Commodity Futures Trading Commission. If prediction-market wagers are handled as derivatives, they fall underneath the CFTC’s jurisdiction and largely outdoors IGRA and the attain of state and tribal regulators. 

Tribes and states counter that the platforms operate as sports activities betting and can’t bypass gaming legal guidelines by labeling wagers as monetary contracts, a distinction they are saying has allowed the markets to increase with out the licensing, age verification or shopper protections required of tribal and state gaming methods.

“I do think this is going to end up with a circuit clash that’s going to be heard before the Supreme Court,” Kunesh mentioned. “It’s been a mixed bag in the lower courts. I’m worried about how long it’s going to take to get something stable and firm in terms of a resolution.”

Some tribes have explored coming into on-line markets themselves, however Kunesh mentioned prediction markets current a special universe from state‑licensed sports activities betting.

“They’ve really worked hard for exclusivity,” she mentioned. “Here we have something that completely blows that out of the water.”

About The Author

Staff Writer

Chez Oxendine (Lumbee-Cheraw) is a employees author for Tribal Business News. Based in Oklahoma, he focuses on broadband, Indigenous entrepreneurs, and federal coverage. His journalism has been featured in Native News Online, Fort Gibson Times, Muskogee Phoenix, Baconian Magazine, and Oklahoma Magazine, amongst others.

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