Gaming Group Says Prediction Markets Cost States $1 Billion in Tax Revenue

The American Gaming Association now estimates that states and tribes have lost more than $1 billion in tax revenue because of prediction market platforms. Association president and CEO Bill Miller said the lost revenue would otherwise fund community projects and Native American casino operations.

Miller told CNBC that prediction markets amount to backdoor sports betting and accused the Commodity Futures Trading Commission of allowing the platforms to operate national sportsbooks with little oversight. Forty-one state attorneys general from both parties have formally told the CFTC it is overstepping into sportsbook regulation, Miller added.

President Donald Trump posted on Truth Social on Tuesday that maintaining the CFTC's jurisdiction over prediction markets is important. The Office of Management and Budget is reviewing a CFTC proposal to issue guidelines for the platforms.

Prediction market companies dispute the revenue-loss figure.

Kalshi spokesperson Elisabeth Diana called the estimate fake math and said the U.S. gaming industry reached a record $78.7 billion in revenue last year. The Coalition for Prediction Markets posted on X that sources for the $1 billion figure were not found.

" — Elisabeth Diana, Kalshi spokesperson Miller also cited a warning from Charles Schwab's CEO that young investors might treat prediction market accounts like brokerage accounts. States have sued several prediction market platforms, while the CFTC has sued states it says are impeding its regulatory authority.