Per Woofun AI, major US gambling industry associations are urging Congress to embed explicit prohibitions against sports prediction markets within the upcoming crypto market infrastructure bill. The American Gaming Association, Indian Gaming Association, and Association of Gaming Equipment Manufacturers submitted a joint letter to the Senate, arguing that platforms offering 'sports event contracts' effectively circumvent state-level gambling regulations and local licensing mandates by packaging these services as financial derivatives.

This intervention highlights significant concerns regarding consumer protection, youth exposure, and the erosion of traditional tax revenue streams tied to local employment. The lobbying effort coincides with the Senate Banking Committee advancing the Clarity Act toward a full vote, while the Commodity Futures Trading Commission (CFTC) continues to navigate complex jurisdictional questions.

Concurrently, enforcement actions against entities like Kalshi and Polymarket reflect an intensifying regulatory tug-of-war between state authorities and federal agencies seeking to define permissible risk categories.