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Federal lobbying over prediction markets is picking up in 2026, with both exchange operators and traditional gaming interests spending more as Congress and regulators debate whether these products belong closer to gambling or financial markets.
CNBC reported that Kalshi spent $990,000 directly on lobbying in the first half of 2026, nearly matching the $1 million it spent in all of 2025. Including outside firms, Kalshi’s federal lobbying total reached nearly $1.8 million in the first six months of the year.
Opponents and other interested parties are also increasing their presence in Washington. The American Gaming Association spent $1.39 million on lobbying so far in 2026, and nearly $1.8 million when outside firms are included. Cherokee Nation spent $600,000 in the first half of the year. A firm lobbying for Polymarket spent $180,000 in the first half of 2026 and was on pace to match the $360,000 spent in 2025.
The spending fight comes as prediction markets face growing scrutiny on Capitol Hill. Lawmakers have introduced bills this year aimed at insider trading concerns and at restricting event contracts tied to sports, elections and acts of war. The Commodity Futures Trading Commission also released a proposed rule for prediction markets in June and is now taking public comment.
At a House Agriculture Committee subpanel hearing on sports-related event contracts, Rep. Dusty Johnson said some Americans see the products as looking “an awful lot like sports betting,” while others view them as innovative financial products. He added that determining where that line should be drawn is the central question for lawmakers and regulators.
That distinction matters for the broader gambling industry because prediction markets and state-regulated sports betting can overlap in how consumers view event-based wagering products. Johnson also said, “The CFTC is not a gambling regulator.”
For now, major legislation appears unlikely in 2026. According to the report, a narrower proposal could still be attached to a broader package, but the current outlook is for the debate to continue through rulemaking, hearings and lobbying rather than a sweeping congressional rewrite.
For players and industry watchers, the key issue is not a new product launch but how federal officials eventually define the boundary between event contracts and gambling. The next major marker is the CFTC process, along with any movement in Congress later this year.
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Source: As reported by cnbc.com.
