NCLGS Examines How States Can Respond to Prediction Markets

United States.- 16 July 2026 www.zonadeazar.com Prediction markets took centre stage at the National Council of Legislators from Gaming States (NCLGS) Summer Meeting, where lawmakers, regulators and legal experts examined the rapid expansion of federally regulated event contracts and the options available to state gaming authorities.

News Details

During the session, former Missouri Gaming Commission Executive Director Gene McNary and gaming attorney Brian Mulvaney discussed the growing conflict between state regulators and platforms such as Kalshi, whose sports event contracts operate under the oversight of the Commodity Futures Trading Commission (CFTC).

Mulvaney argued that the central issue extends beyond whether event contracts resemble sports betting, focusing instead on the division of authority between federal regulation and state gaming laws. He suggested that the matter is ultimately likely to be resolved through the federal courts or the US Supreme Court.

Panellists also explored policy options that could allow states to preserve their regulatory frameworks without conflicting with federal oversight as prediction markets continue expanding into sports and other event categories.

Industry Context

The rise of prediction market operators has intensified tensions between state gaming regulators and federal authorities. While several states argue that sports event contracts function as sports wagering, the CFTC maintains that they fall within federally regulated derivatives markets.

The issue has become one of the most significant regulatory debates in the US gaming industry throughout 2026 and has featured prominently at both the NCLGS Summer Meeting and other major industry forums.

Statements

Brian Mulvaney said the conflict between state regulators and federal authorities is expected to continue through the courts, with future judicial decisions likely to determine the boundaries of each regulator’s authority over prediction markets.

Panellists agreed that any long-term solution should provide legal certainty for both operators and regulators while supporting an orderly development of the market.

Next Steps or Impact

Upcoming court rulings concerning sports event contracts are expected to play a decisive role in shaping the relationship between federal regulation and state gaming laws. The discussions at NCLGS suggest that prediction markets will remain one of the industry’s defining regulatory issues.

Edited by: @_fonta