Nevada

Problem gambling orgs join Nevada legal fight against prediction markets

Published

3 months ago

March 30, 2026

Problem gambling orgs join Nevada legal fight against prediction markets

Dana Gentry
| Nevada Current

Nevada’s leading authorities in preventing and treating problem gambling are joining state regulators and the casino industry to combat prediction markets, which, they contend, threaten to cut into the action of Nevada’s gambling enterprises and worsen the nation’s addiction to betting, especially on sports.

In less than a decade, legal sports betting, with the help of a U,S. Supreme Court ruling and the omnipresent smart phone, has morphed from a Nevada-centric novelty to a ubiquitous national pastime, with a slew of harmful side effects.

Nevada, once the only player in the legal sports betting game, has been relegated to the minor leagues in terms of revenue generated.

The American Gaming Association projects wagering on the 2026 NCAA tournament, excluding prediction market betting, which has not been officially estimated, will reach $3.3 billion, up 54% in the last three years.

Nevada’s 2025 March Madness betting was estimated at $466 million.

ESPN reports bettors wagered $1.9 billion on college basketball games in February on Kalshi alone.

In late December, the Financial Times reported trading volume on sports bets on Kalshi since its inception reached $16.8 billion, compared with $4.9 billion on other topics. By comparison, Nevada’s sports betting handle for 2025 was $8 billion, down 9% from the previous year.

Prediction platforms, critics argue, threaten to upend Nevada’s nearly 100-year history of profitable, regulated gambling.

Two betting sites, Kalshi and Crypto.com, are wrangling with Nevada gaming regulators and the Nevada Resort Association in the Ninth Circuit Court of Appeals. The platforms are challenging the constitutionality of state law, which requires that gambling enterprises have a state gaming license.

The Ninth Circuit last week denied Kalshi’s emergency motion to stop Nevada from enforcing its regulations pending the outcome of the appeal, according to Nevada Current. The ruling allowed Nevada to obtain a temporary injunction in state court prohibiting Kalshi from taking bets from gamblers in Nevada, at least until an April 3 hearing.

The Nevada Council on Problem Gambling, which specializes in prevention, and The Dr. Robert Hunter International Problem Gambling Center, a leading treatment center, filed amici, or ‘friend of the court’ briefs in the Ninth Circuit case, where a hearing is scheduled for April 16.

“Kalshi and similar prediction markets are the newest craze in sports betting and have exploded into the cultural zeitgeist,” the NCPG’s brief asserts.

The council rejects the argument that prediction platforms engage in commodity trades. “If it behaves like gambling, it should carry the same guardrails, accountability, and public health obligations — otherwise you create a parallel market with fewer protections and higher risk,” says NCPG’s Executive Director Trey Delap.

Chief among Delap’s concerns is the speed at which prediction platform gambling moves.

“It eliminates ‘friction’ — virtually eliminating any sort of time delay in accessing money and breaks in play,” Delay, a recovering problem gambler, said Thursday. “These breaks allow for a moment of awareness where one may judge the impact of their play.”

State regulators argue Kalshi is subject to Nevada law when taking bets in Nevada. Kalshi and others contend their federal regulatory status under the Commodities and Futures Trading Commission exempts them from state oversight.

The CFTC “does not propound or enforce gaming regulations, especially those related to preventing and addressing problem gambling,” NCPG’s brief argues. “To allow Kalshi’s sports betting to be regulated only by the CFTC is effectively to allow it to be unregulated with regard to problem gambling risk.”

The CFTC recognizes its regulatory limitations, the brief notes, citing a 2024 Notice of Proposed Rulemaking that would have prohibited betting on political and sporting events.

Commission regulations, the proposed rule said, are “focused on regulating financial instruments and markets, and do not include provisions aimed at protecting gambling specific risks and concerns inherent to gambling. …Gambling is a rapidly evolving field, and the Commission does not believe that it has the statutory mandate nor specialized experience to oversee it.”

The proposed rule was withdrawn in January.

“Nevada’s model works because of proximity — regulators, operators, and support systems are integrated,” says Delap. “Removing that structure weakens protections for consumers.”

Unlike casinos or sportsbooks “where the gambling nature of the activity is explicit — Kalshi downplays or omits warnings related to addiction, loss of control, or financial harm,” NCPG argues in its filing. “Instead, Kalshi famously portrays itself as intellectually rigorous, socially valuable, and skill based.”

The filing contends that “Kalshi’s slick, easy to use platform mimics traditional gambling, meaning that the risk associated with the use of the platform is high.” Without safeguards, it asserts, “the use of Kalshi in the state of Nevada is a public health crisis waiting to happen.”

Nevada gambling regulation for in-person and on-line wagering includes a number of safeguards, including age and identity verification, advertising standards, mechanisms for self-exclusion from play, and funding for problem gambling programs. Online operators are responsible for additional measures, including limits on deposits, bet amounts, and time playing.

“These safeguards do not eliminate all risk. They manage it,” says the NPGC’s brief.

Almost half of digital sports betting ads viewed in the U.S. this year are from prediction market platforms, which are not subject to responsible gambling advertising requirements that apply to state and tribal gambling operations.

Kalshi is the most visible sports betting advertiser in the U.S., with about 5.2 billion digital ad impressions this year, according to research from the American Gaming Association. The second most prolific advertiser, Fan Duel, generated 2.9 billion impressions.

In January and February, nearly half of digital sports betting ads in the U.S. were for prediction platforms, and did not include responsible gaming messaging, as required by states.

In addition to lacking safeguards, the brief notes a dearth of national policy dialogue amid the explosion of betting on prediction platforms.

Gambling disorder, it notes, is “a clinical condition that can be diagnosed in individuals. Public health policy, by contrast, focuses on population-level exposure, accessibility, and environmental risk.” Public health policy examines not only “who develops a disorder, but how many people are exposed to risk, how frequently, and under what safeguards.”

“Increased access, speed, and normalization of wagering-like products are associated with higher risk of harm at the population level,” says Delap of the NCPG.

Strange bedfellows?

Critics of the multi-state effort to rein in prediction platforms blame anticompetitive state and tribal licensees, some of which have been known to stray outside the regulatory boundaries they now seek to impose on the platforms.

Consumer protection, prediction market advocates argue, is a priority for licensees only when faced with a new form of competition, such as tribal or internet gambling.

“This isn’t about protecting consumers,” Kalshi CEO Tarek Mansour wrote on X this week of the effort to ban sports betting on prediction platforms. “It’s about protecting monopolies.”

An analysis by the National Council on Problem Gambling found that on average, states with legal gambling met only 32 of its 82 recommended player protection standards. Nevada aligned with 24 of the NCPG’s standards, landing it in the bottom tier of compliance with ten other states.

A University of Nevada Las Vegas Institute of Gaming study published last year found 15% of Nevada adults are defined as problem gamblers, meaning they’ve experienced harm from their gambling “many times” in the last year. The national average is 2%, according to the National Council.

Yet, the state’s commitment to adequately funding problem gambling prevention and treatment has long been lacking.

Problem gambling organizations in Nevada have historically declined to opine on whether betting is inherently good or bad. Their prevention and treatment efforts are often supported by casinos, financially and in other ways, such as making promotional material about problem gambling accessible to gamblers.

Delap contends the council’s brief does not signal alliance with the gaming industry.

“In informing the court on the public risk and harm, our position would be the same regardless of gaming’s position,” he said, adding that “since the harm of problem gambling is felt at the community and state level, we should have authority to protect the public.”

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