Prediction markets, casino groups and sports-betting interests are stepping up efforts in Washington as Congress and regulators scrutinize event contracts, insider-trading safeguards and the CFTC’s proposed rule.
Kalshi sharply increased its Washington spending in the first half of 2026, putting the U.S. prediction market platform at the center of a broader lobbying fight with Polymarket and the casino and gaming industry. Federal disclosures show Kalshi spent $990,000 directly on lobbying in the period and nearly $1.8 million including outside firms, exceeding its full-year 2025 direct total of $1 million and marking its highest six-month outlay to date. The spending surge comes as prediction markets face growing political and regulatory pressure. Lawmakers have introduced multiple bills this year targeting insider trading and seeking to restrict event contracts tied to sports, elections and acts of war. Debate has centered on whether sports-related contracts are swaps (derivatives tied to an outcome) that should remain under the Commodity Futures Trading Commission (U.S. derivatives regulator), as prediction market operators argue, or effectively sports betting, which critics say should be regulated by states. Casino and gaming interests are also increasing their presence on Capitol Hill. The American Gaming Association spent $1.39 million on lobbying so far in 2026 and nearly $1.8 million including outside firms, 30% more than in the first half of 2025, while Cherokee Nation spent $600,000 in the first half. Polymarket’s Washington footprint remains smaller: one lobbying firm spent $180,000 on its behalf in H1 2026, putting it on pace to match the $360,000 spent in 2025. The policy battle has intensified after trades placed ahead of U.S. military actions in Venezuela and Iran raised insider-trading concerns. The Wall Street Journal also reported in the last week on betting that may have relied on inside political information, while President Donald Trump’s teleprompter operator was suspended after it was disclosed he was under investigation for using material, nonpublic information to place trades on Kalshi. Despite tough rhetoric from lawmakers, TD Cowen policy analyst Jaret Seiberg said the lack of congressional action currently favors the platforms. The CFTC’s June proposed rule for prediction markets, now in a public comment period, remains the key regulatory process to watch.