Annual Membership Meeting San Diego Convention Center—Room 6A San Diego, CA (Quorum will be announced when established)
Tuesday, March 31 8:30 am
Posting of Colors Native American Women Warriors Color Guard Smoke Dancers – Grandchildren of Ernest L. Stevens, Jr. Invocation Markane Ellis
9:00 am
Welcome
9:10 am
Honoring Chairman Ernest L. Stevens, Jr.
9:30 am
Indian Gaming Association’s State of the Industry Address David Bean – Chairman, Indian Gaming Association Jason Giles – Executive Director, Indian Gaming Association 2025 Audit Report with Grant Eve
10:00 am
Call for Nominations Positions of Vice-Chair and Treasurer
10:30 am
Prediction Markets Current State of Affairs
Moderator: Jason Giles, Executive Director – Indian Gaming Association Bill Miller, President – American Gaming Association Rodney Butler, Chairman – Mashantucket Pequot Tribal Nation
11:15 am
Prediction Markets-Litigation Joe Webster Scott Crowell
Michael Hoenig, Yuuhaavatim’s lead attorney
12:00 pm
Regional Caucuses
12:30 pm
Chairman’s Sovereign Warrior Award Luncheon
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2:30 pm
Native American Rights Fund Melody McCoy
2:45 pm
Tribal Leader Policy Discussion: Confronting Prediction Markets and the CFTC
Meeting Recesses until Wednesday, April 1, 2026
4:30 pm
5:30pm
IGA Welcome Reception, San Diego Convention Center, West Terrace
Wednesday, April 1
Membership Meeting Reconvenes Shakopee Check Presentation Final Call for Nominations Vice-Chair and Treasurer
1:30 pm
1:40
1:45 pm
Candidate Speeches Voting Begins Voting Ends Vote Tabulation Swearing-in of Officers Meeting Adjourns
3:15 pm
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U.S. House of Representatives Committee on Agriculture Full Committee Hearing on “CFTC Reauthorization: Stakeholder Perspectives” Testimony of David Bean, Chairman , Indian Gaming Association December 11, 2025 Chairman Thompson, Ranking Member Craig, and Members of the Committee, on behalf of the Indian Gaming Association (“IGA”), thank you for holding this hearing to receive stakeholder perspectives for the reauthorization of the Commodities Futures Trading Commission. My name is David Bean, and I serve as the Chairman of the Indian Gaming Association. Founded in 1985, IGA is a national association of federally recognized Indian tribes united behind the mission of protecting tribal sovereignty and preserving the ability of tribal governments to attain economic self-sufficiency through gaming and other forms of economic development. We appreciate this timely opportunity to provide testimony for your hearing to examine the need to reauthorize the Commodity Futures Trading Commission (“CFTC”). We share the views expressed by witnesses and Committee members during the hearing that as Congress considers the CFTC reauthorization it must also revisit the Commodity Exchange Act (“CEA”) itself. Inaction by the CFTC has led to the explosion of prediction market platforms offering event contracts that are in fact nationwide online sports gambling sites. In January of 2025, prediction markets initially offered simple “yes” or “no” bets on the outcomes of a single sporting event. However, the CFTC’s complete lack of oversight or even questioning of swaps or transactions relating to sporting events has emboldened prediction markets to offer a wider range of gambling options, including parlays, individual player proposition bets, and more. Just yesterday, KalshiEX LLC, notified the CFTC that it has self-certified contracts on whether college athletes will enter the transfer portal. The move drew immediate condemnation: "The NCAA vehemently opposes college sports prediction markets…. It is already bad enough that student-athletes face harassment and abuse for lost bets on game performance, and now Kalshi wants to offer bets on their transfer decisions and status. This is absolutely unacceptable and would place even greater pressure on student-athletes while threatening competition integrity and recruiting processes. Their decisions and future should not be gambled with, especially in an unregulated marketplace that does not follow any rules of legitimate sports betting operators." https://www.espn.com/college-football/story/_/id/47341610/prediction-market-kalshi-intends- offer-trading-portal It is crystal clear that prediction markets will not stop at sports gambling. They will continue to push the envelope as long as the CFTC continues to turn a blind eye. This activity represents a direct threat to tribal governments, state governments, the public, and the very integrity of American sports. We respectfully urge Congress to amend the CEA to
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reinforce these existing prohibitions and ask that you conduct thorough oversight of the CFTC to ensure that the agency is enforcing its own laws and regulations. The Importance of Indian Gaming to Tribal Government Economies When the United States formed, it acknowledged Indian tribes as sovereign governments, entering into hundreds of treaties with tribal governments to establish commerce and trade agreements, form alliances, and preserve the peace. The U.S. Constitution affirmed these treaties and the sovereign authority of Indian tribes as separate governments. The Constitution’s Commerce Clause expressly provides that “Congress shall have power to ... regulate commerce with foreign nations, and among the several states, and with the Indian tribes . ” 1 A handful of tribal governments in the 1970’s, tired of waiting on the United States to fulfill its treaty and trust obligations to tribes, took measures to rebuild their communities by opening the first modern Indian gaming operations. Tribes used the revenue generated from Indian gaming to fund essential programs for reservation residents, cover the federal shortfalls, and to meet the basic needs of their people. These acts of self-determination were met with legislative and legal challenges lodged by states and commercial gaming interests. In 1987, after years of contentious litigation, the U.S. Supreme Court, in Cabazon Band of Mission Indians v. California , affirmed that tribal governments have full civil regulatory authority to govern tribal gaming activities on tribal lands, exclusive of state government regulation so long as state law did not criminally prohibit all forms of gaming. On October 17, 1988, having been enacted by Congress, President Reagan signed the Indian Gaming Regulatory Act (IGRA) into law. IGRA divided gaming activities into three categories. Class I gaming encompasses social and traditional forms of gaming conducted by tribes traditionally, assigning full regulatory oversight to tribal governments. Class II gaming encompasses bingo, lotto, and similar games as well as non- house banked card games, assigning regulatory oversight to tribal governments and the newly established National Indian Gaming Commission. Class III gaming encompasses all other forms of gaming but requires the execution of a tribal-state gaming compact before a tribal government may conduct Class III gaming. Sports betting falls within Class III gaming, thereby requiring a tribal-state gaming compact before a tribal government may conduct sports betting. The NIGC is the first and only federal agency created and explicitly authorized by Congress to provide regulatory oversight in relation to gaming activities. In fact, the Justice Department strongly opposed IGRA in the years prior to its enactment on the grounds that as a matter of policy the federal government should not be involved in the direct regulation of gaming activities, which DOJ believed comes within the province of the states. Like most legislation, IGRA is the product of compromise between federal, state, and tribal interests. Congress made clear that the purposes of IGRA are to: 1) provide a statutory basis for the operation of gaming by Indian tribes as a means of promoting tribal economic development, self-sufficiency, and strong tribal government; 2) provide a statutory basis for the regulation of gaming by an Indian tribe adequate to shield it from organized crime, and to ensure that the Indian tribe is the prime beneficiary of the gaming operation; and 3) establish an independent federal regulatory authority for gaming on Indian lands, federal standards for gaming, and the NIGC to meet congressional concerns regarding gaming and 1 In addition, the U.S. Constitution refers to tribal citizens in the Apportionment Clause, as “Indians not taxed”, excluded from enumeration for congressional representation. The 14 th Amendment repeats the original reference to “Indians not taxed” and acknowledges that tribal citizens were not subject to the jurisdiction of the United States. The Constitution also acknowledges that treaties are the Supreme law of the land.
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to protect such gaming as a means of generating revenue. To understand the significance of IGRA and why Congress was willing to overlook the longstanding policy of leaving gaming regulation to state governments, there are two key historic facts that must be understood. The first is the special trust relationship between the United States, which entails both moral and legal obligations to tribal governments. The second is that tribal governments, like state governments, are an integral part of the Constitutional framework of the United States as reflected in Article I, Section 8 cl. 3 of the Constitution itself. Except in the few, rare cases where tribes owned developable natural resources, such as oil, gas, and other extractive minerals, tribal governmental revenues were largely insufficient to meet the needs of tribal citizens. Most tribal governments were largely dependent on federal resources for basic governmental services and even these were not sufficient fill the gap for even the most basic services. Much of Indian Country lacked adequate education, law enforcement, fire protection, water and sewage, doctors, clinics, hospitals, schools, roads, bridges, and other basic infrastructure and services. Even today, many tribal citizens have no or limited access to clean water and electricity, much less cellular and internet services. IGRA reflects Congress’ “outside the box” approach to addressing these terrible conditions. For those tribal governments that have been able to use gaming as a means of generating governmental revenue, the difference has been astounding. By any socioeconomic measure, improvements have been dramatic from increases in life expectancy to community health and public safety, to education to infant mortality rates to jobs and employment, and the list goes on. Gaming revenues serve as the tax base that tribal governments previously never had. Tribal gaming revenue builds and strengthens tribal governments and improves the quality of life in Indian Country. It does not enrich the few; it builds Nations. Indian gaming is the economic bloodline for 243 tribal governments. Tribal governments use Indian gaming revenue to put a new face on their communities, dedicating resources to improving basic health, education, and public safety services on Indian lands. Tribes use gaming revenue to improve infrastructure, including the construction of roads, hospitals, schools, police buildings, water projects, communications systems, and so much more. In 2024, 243 tribal governments in 29 states generated $43.9 billion in direct revenues through Indian gaming operations and $5.7 billion in ancillary revenues 2 for a total of $49.6 billion in total revenues. Without question, Indian gaming is the most successful tool for economic development for many Indian tribes in over two centuries. For many tribes, Indian gaming is first and foremost about jobs. Nationwide, Indian gaming is a proven job creator. In 2024, our industry generated more than 274,000 direct jobs. When indirect jobs are included, Indian gaming employs more than 672,000 Americans. Indian gaming has provided many Native Americans with their first opportunity for work at home on the reservation. Because of Indian gaming, reservations are again becoming livable homesteads, as promised in hundreds of treaties. These American jobs go to both Indians and non-Indians alike. Tribal governments realize that none of these benefits would be possible without a strong regulatory system to protect tribal gaming revenues and preserve the integrity of our operations. Tribes invest more than $450 million annually, employing more than 6,000 regulators to oversee
2 Ancillary revenues include hotels, food and beverage, entertainment, and other activities related to a tribal government’s gaming operation.
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Indian gaming operations daily. 3 The regulatory system established under IGRA vests local tribal government regulators with the primary day-to-day responsibility for regulating Indian gaming operations. No one has a greater interest in protecting the integrity of Indian gaming and our assets than tribal governments. While tribes take on the primary day-to-day role of regulating Indian gaming operations, IGRA requires coordination and cooperation with the federal and state governments to make this comprehensive regulatory system work. Our comprehensive regulatory system ensures consumer protection, fraud prevention, and local decision-making to address social implications like problem and underage gaming. At the federal level, tribes work with the NIGC, the FBI and U.S. Attorneys offices to investigate and prosecute anyone who would cheat, embezzle, or defraud an Indian gaming facility – this applies to management, employees, and patrons. 18 U.S.C. §1163. Tribal regulators also work with the Treasury Department’s Internal Revenues Service to ensure federal tax compliance and the Financial Crimes Enforcement Network (FinCEN) to prevent money laundering. This comprehensive multi-layered system of regulation is costly and time consuming, but it has proven its worth year after year. The credit for this system goes to the tribal leaders who make the decisions to fund this system and to the thousands of men and women who have devoted their lives to protecting tribal assets and the integrity of our operations. Gambling through the CFTC Violates Tribal, State, and Federal Laws Sports betting that is being conducted through prediction markets – Designated Contract Markets (“DCM”) licensed by the CFTC – violates tribal, federal, and state laws, including the Indian Gaming Regulatory Act, which expressly provides tribal governments with exclusive authority to regulate gaming on Indian lands in partnership with states and the NIGC. Background: Sports Betting in the United States Historically, gambling in the United States has been subject to the local decision making of tribal and state governments. Where they chose to legalize the activity, states and tribes establish gaming commissions and control boards to oversee the industry and enforce local laws and regulations. Gambling on the outcomes of sporting events has a more complicated and relatively recent history. In 1992, Congress sought to prohibit all forms of sports betting in the United States through enactment of the Professional and Amateur Sports Protection Act (“PASPA”). While several state governments were exempted from the nationwide prohibition, gambling on sporting events was generally prohibited at the federal level for more than 25 years. In May of 2018, the United States Supreme Court, in Murphy v. NCAA , struck down PASPA as violating the Tenth Amendment’s anti-commandeering doctrine. Murphy returned oversight of sports betting to local tribal and state government policy makers. In the eight years since the Murphy decision, sports betting has grown slowly on a tribe-by-tribe and state-by-state basis. In the more than seven years since Murphy , a number of states chose to continue the prohibition against sports betting for religious, moral, and other reasons. Two states, Utah and Hawaii, criminally prohibit nearly all forms of gambling within their jurisdictions. Nine other states –
3 NIGC Budget Justifications and Performance Indication FY2025 at NIGC-1; https://www.doi.gov/sites/default/files/documents/2024-03/fy2025-508-nigc-greenbook.pdf.
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Alabama, Alaska, California, Georgia, Idaho, Minnesota, Oklahoma, South Carolina, and Texas – prohibit sports betting. Those jurisdictions that have legalized sports betting set parameters that include age restrictions – with the great majority restricting sports betting to persons 21 years old and older, problem gambling measures, prohibitions against betting on local sports teams, prohibitions against betting on high school and college sports, prohibitions against player proposition bets, and some also require operators to offer mandatory deposit limits and session time limits, integrated with local problem gambling helplines and self-exclusion systems. Tribal and state regulatory systems ensure full transparency, work with the leagues to protect the integrity of American sports and maintain strict consumer safeguards and responsible gaming practices. It’s a proven framework that protects players and the public while delivering resources to benefit local community. Under this system, elected leaders in each tribe and state decide whether to allow sports betting, and in return, economic and tax benefits flow directly back to their communities. Under IGRA, tribal governments use 100 percent of all revenue generated from gaming, including sports betting, to tribal programs and services as well as contributions to state and local governments. Pursuant to some tribal-state gaming compacts, tribes also share a portion of their sports gambling revenue with state governments. In 2024, state governments generated approximately $2.5 billion from sports wagering. States use the revenue generated from sports gambling to offset costs of regulation, employ problem gambling programs, and direct remaining revenue towards local priorities, including education and elder programs, property tax relief, infrastructure and public services, and other initiatives. There is an ongoing debate among tribes and states that have legalized sports gambling about whether to offer the activity on the internet. To some, online sports betting poses added risks to underage and problem gambling, heightened risks of addiction, mental health concerns, and personal financial and other concerns. Prediction markets that offer gambling on the outcome of sports through event contracts completely sidestep these debates, ignoring the consequences, and for nearly one year now, have forced their way into the homes of every American family in direct subversion of tribal and state policy makers. Sports betting conducted pursuant to prediction markets also circumvents the ability of states to generate revenue, offers no local benefits, and offers none of the consumer protections or detailed gambling regulations required by tribal and state governments. In addition, for Indian Country, prediction markets that offer sports gambling directly violate tribal sovereignty and IGRA. Prediction markets offer their online gambling contracts nationwide in all 50 states and on every Indian reservation in the nation. These operators conduct gaming activities on Indian lands without tribal government consent, licensure, or regulatory oversight. This is a direct violation of IGRA, which confers exclusive authority to tribal governments to regulate gaming activities on Indian lands. The proponents of sports wagering contend that the activity is an innovative use of the prediction market, but their advertising reveals the truth. The wagering aspect can hardly be characterized as thinly disguised. To grant these proponents a path around true regulatory oversight abandons the interests of consumers and constitutes a betrayal of tribal governments to whom the United States holds the highest duty of trust.
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The CFTC Lacks the Capacity to Regulate Gambling The CFTC was never intended to serve as a regulatory agency over gaming activities and has neither the capacity nor the expertise to provide regulatory oversight at the level needed to protect consumers, prevent fraud and criminal infiltration, or protect against cheating and corruption. The CFTC is a statutory agency created under the Commodity Futures Trading Commission Act of 1974, charged with the responsibility of regulating futures and derivatives markets in order to promote market integrity, protect market participants, and ensure the proper functioning of price discovery and risk management mechanisms. Its mission is essential to protect both market participants and the broader public from fraud, manipulation, and systemic risk. As Congress considers reauthorization of this agency, we urge you to address the significant concerns raised by CFTC’s recent willingness to allow prediction markets to manipulate the authority of the CEA and the CFTC’s own regulations to offer event contracts that constitute illegal sports betting primarily designed to avoid state, tribal and other federal laws and regulations. The CEA, codified at 7 U.S.C. § 1 et seq., provides the CFTC with jurisdiction over “contracts of sale of a commodity for future delivery” and related derivatives. Congress has consistently reaffirmed that the purpose of this jurisdiction is to regulate markets that serve bona fide hedging and price-discovery functions that serve an inherent economic interest, not to authorize speculative gambling on the outcomes of events unrelated to economic commodities. The Commodity Futures Modernization Act of 2000 (“CFMA”) significantly deregulated derivatives markets, with an express goal of limiting regulation of over-the-counter swaps and energy derivatives. That law established a regulatory void that permitted the highly risky credit default swap market to flourish, which proved a key factor in the 2008 Financial Crisis. Congress acted to fill the regulatory voids created by the CFMA when it enacted the Dodd-Frank Act of 2010, which significantly overhauled the CFTC. While Dodd-Frank did not directly restore a broad economic purpose test, it did empower regulators, especially the CFTC, to use public interest standards, effectively bringing back aspects of the economic purpose test for new derivatives, particularly event contracts, by requiring evaluation for hedging/commercial uses versus pure gambling. Dodd-Frank amended the CEA at 7 U.S.C. §7a-2 (“Common Provisions Applicable to Registered Entities), which included a special rule for CFTC review and approval of event contracts and swaps. The special rule provides that the CFTC may determine that “agreement, contracts, or transactions are contrary to the public interest if the agreements, contracts, or transactions involve – activity that is unlawful under any federal or state law; terrorism, assassination, war, gaming or other similar activity determined by the Commission by rule or regulation, to be contrary to the public interest.” On July 27, 2011, the CFTC published a regulation implementing the special rule under §7a-2. The regulation expressly provides that “[a] registered entity shall not list for trading or accept for clearing on or through the registered entity any of the following: (1) An agreement, contract, transaction, or swap based upon an excluded commodity, as defined in Section 1a(19)(iv) of the Act, that involves, relates to, or references terrorism, assassination, war, gaming, or an activity that is unlawful under any State or Federal law; or (2) An agreement, contract, transaction, or swap based upon an excluded commodity, as defined in Section 1a(19)(iv) of the Act, which involves, relates to, or references an activity
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that is similar to an activity enumerated in § 40.11(a)(1) of this part, and that the Commission determines, by rule or regulation, to be contrary to the public interest.” 17 C.F.R. § 40.11 Review of event contracts based upon certain excluded commodities. As a result, the CEA and the CFTC’s existing regulations prohibit registered entities from listing transactions that involve or relate to gaming – commonly defined as gambling. Despite this clear prohibition, over the past year, the CFTC has permitted a growing number of its registered entities to offer an ever-growing range of gambling contracts on the outcomes of sporting events, including moneyline bets on individual games, parlays on multiple games, proposition bets on individual performance. While the law and regulation are clear, prediction markets have attempted to blur the lines between gambling and investing. The most prolific DCM currently licensed by the CFTC that offers gambling on the outcome of sports is KalshiEX LLC (“Kalshi”). Kalshi has attempted to exploit the lack of defined terms in the CEA and CFTC regulations to further complicate the issue of prediction market-sports gambling in its legal filings and its lobbying efforts to oppose the enforcement of existing laws and regulations that prohibit gambling through financial exchanges. Last year, in defense of its event contracts relating to the outcomes of the 2024 federal elections, Kalshi admitted that the CEA and CFTC regulations did prohibit event contracts on the outcome of sporting events. Below is a list of examples provided by Mr. Daniel Wallach, a well-respected sports betting attorney, through a post on LinkedIn, where Kalshi admits in court proceedings that event contracts relating to the outcome of sports violate the CEA and CFTC regulations: • “Congress did not want sports betting to be conducted on derivatives markets.” - Kalshi's Initial Brief filed in the D.C. Circuit on Nov. 15, 2024, at p. 41 • “Evidently, Congress sought to prevent exchanges from facilitating casino-style or sports gambling.” - Kalshi's Initial Brief filed in the D.C. Circuit on Nov. 15, 2024, at p. 45 • “[C]ontracts relating to games—again, activities conducted for diversion or amusement—are unlikely to serve any 'commercial or hedging interest.'” - Kalshi's Initial Brief filed in the D.C. Circuit on Nov. 15, 2024, at p. 45 • “Congress was particularly concerned at the time it enacted this statute about sports betting and that was probably what they were getting at with the word ‘gaming.’” - Kalshi to the D.C. Circuit at the January 17, 2025 oral argument (at 49:50-50:08) • “The 'gaming' category reaches contracts contingent on games—for example, whether a certain team will win the Super Bowl. It thus functions as a check on attempts to launder sports gambling through the derivatives markets." - Kalshi MOL in Support of MSJ, Jan. 25, 2024, at 16 • “Football, horseracing and golf. They’re all games…. It’s something that has no inherent economic significance." - Kalshi's May 30, 2024 oral argument to the district court on its motion for summary judgment, Dkt. # 40, at p. 15 • “Contracts that involve games are probably not the type of contracts that we want to be listed on an exchange, because they don’t have any real economic value to them." - Kalshi's 5/30/24 oral argument to the district court on its motion for summary judgment, Dkt. # 40, at p. 15. See Daniel Wallach LinkedIn Post at https://www.linkedin.com/posts/amanda-fischer- 21877210_the-maryland-federal-court-is-right-to-demand-activity-7335376474855661570-uib_
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In January of 2025, Kalshi completely reversed the positions listed above by self-certifying event contracts directly related to the outcomes of sporting events. Kalshi and other prediction markets recognized enforcement weaknesses at the CFTC and have quickly exploited them. The first sport event contracts that CFTC inaction enabled were offered by DCMs in January 2025. There was approximately $1.3 million in volume related to Super Bowl LIX. Ten months later, in October of 2025, prediction markets reported more than $4 billion in monthly volume related to sport event contracts. Because CFTC regulations allow prediction markets to self-certify event contracts without pre- clearance from the agency, companies can launch gambling products, generate profits, and then litigate in court later. This litigation-driven business model has resulted in 26 pending lawsuits to date, where states, tribal governments, and individual consumers argue that the prediction markets violate federal, state and tribal law and exploit consumers. While prediction markets argue in court that their contracts on the outcomes of sporting events are not gambling, they openly advertise that their contracts are “legal” gambling. Prediction markets have spent millions of dollars to advertise their products as legalized sports betting in all 50 states. One advertisement from January by prediction market Kalshi stated that it is “The First Nationwide Legal Sports Betting Platform.” Kalshi also ran advertisements during the college basketball tournament in Texas and California – where all sports betting is illegal – that said “Make $ on March Madness” and “Legal in Texas” and “Legal in California”. Another advertisement said “Sports betting is officially legal in Texas with Kalshi. The first federally regulated exchange where you can bet on real outcomes.” Again, all sports betting is illegal under state law in Texas and California. Thus, these prediction markets are offering contracts on sport event outcomes and intentionally misleading consumers and purposefully thwarting state laws.
As noted above, this amounts to nationwide online gambling that has deluged every corner of the United States. For decades, state and tribal governments have debated concerns about the impacts
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of online gambling as it draws teenagers, poses added risks to problem gambling, and heightens risks of addiction, mental health concerns, and personal financial and other concerns. Prediction markets sidestep these debates and ignoring the consequences.
CONCLUSION It is no coincidence that the prediction market corporations selected the CFTC as the financial regulatory agency to push out their self-certified self-regulated online gambling platforms. The prediction markets recognized regulatory weakness at the CFTC, and they have actively exploited the agency’s lack of capacity or lack of will to enforce its regulations. Complete inaction by the CFTC proves this point. Prediction markets have offered sports betting for 11 months now. Just weeks ago, the CFTC issued a statement that the agency “has not, to date, made a determination regarding whether” these contracts involve a prohibited activity. No legitimate federal regulatory agency would publicly admit that it has failed to even question activity that blatantly violates the law and regulations directly under its charge. The prediction market platforms are counting on continued inaction from the CFTC. They will continue to push the limits of and blur the lines between event contracts and gambling. Sports betting is only the beginning. We respectfully urge this Committee and Congress to put a stop to this illegal activity by amending the CEA to reinforce the existing prohibition against casino gambling in general and sports betting in particular.
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Commodities Futures And Trading Commission Is Allowing Sports Betting
• Starting in February 2025, the Commodities Futures Trading Commission (CFTC), with no Notice, and through an Acting Chairperson, started to allow so-called futures contracts on sporting events, and other events such as political elections and even weather events. • As we all know in Oklahoma, the CFTC is set up under the Department of Agriculture to regulate commodities contracts such as soy beans, corn, oil, pork, and all other types of agricultural and natural resources. • These new so-called “futures contracts” are a ‘yes/no’ bet on whether a specific outcome will occur. For instance, a yes/no bet on whether the Team A will beat Team B in the Super Bowl, or will “x” person be the next Speaker of the House of Representatives. • This is sports and events betting, not the more common Agricultural and Commodities trading regulated by the CFTC.
• These are bets with no underlying commodity at stake and are not regulated by experts at Tribal or State sanctioned sports book.
• Instead, these events contracts are currently available in ALL 50 States on the futures market along with agricultural and other products. • Since April 2025, These prediction markets side-step State and Tribal regulations, and have been involved in numerous scandal, regarding Venezuela, the Super Bowl Half-Time show, Iran War, and others. Prediction Markets clearly violate the long-standing public policies necessary for the safe regulation of gaming.
Key Concerns Regarding Sports Contracts
1. Violation of Sovereignty : The trading of Sports/Events Contracts under the CFTC infringes upon the sovereign rights of tribes and states to regulate gaming within their territories. This interference also conflicts with the WIRE ACT, IGRA, and the Commodities Exchange Act (CEA). 2. Impact on Gaming Compacts : Sports Contracts undermine the exclusivity of gaming compacts negotiated between tribes and states. Revenue-sharing agreements in these compacts are crucial for funding state and tribal services. Sports Contracts will intercept the necessary gaming revenue for the States and Tribes and threaten the police-power of the States and Tribes to regulate gaming within their jurisdictions. 3. Revenue Loss : The potential trading of Sports Contracts could divert significant revenue from regulated sports betting, which is essential for funding tribal and state government services. For instance, states that have legalized sports betting collected approximately $1.8 billion in tax revenue in fiscal year 2023, which directly supports the gaming regulation in those states. 4. Public Health and Safety : CFTC sanctioned Sports Contracts lack the necessary consumer protection measures to address issues such as gambling addiction and fixing. Further, the CTFC as a federal agency lacks the necessary infrastructure to regulate and enforce violations of State and Tribal gaming policies. 5. Promising Developments : Through the Coordination of Indian Gaming, Commercial Gaming, and State Attorney Generals, we now have a DRAFT Bi-Partisan Bill in the House to amend the Commodities Exchange Act and shut these prediction markets down. There are now over 42 lawsuits by Tribes, States, and consumers, against these prediction markets. Sovereignty and the law are on our Side!
6351-01-P
COMMODITY FUTURES TRADING COMMISSION 17 CFR Chapter I RIN 3038-AF65 Prediction Markets AGENCY: Commodity Futures Trading Commission. ACTION: Advance notice of proposed rulemaking; request for comments. SUMMARY: The Commodity Futures Trading Commission (Commission or CFTC) is issuing this Advance Notice of Proposed Rulemaking and seeking public comment regarding event contract derivatives traded on markets commonly referred to as “prediction markets.” In particular, the Commission is seeking information and public comment on statutory core principles and Commission regulations that apply to prediction markets, the types of event contracts that may be prohibited as contrary to the public interest, cost-benefit considerations related to prediction markets, and other topics. The Commission may use the information and comments received from this Notice to inform potential future agency action, such as rulemaking, with respect to prediction markets. DATES: Comments must be in writing and received by [INSERT DATE 45 DAYS AFTER DATE OF PUBLICATION IN THE FEDERAL REGISTER]. ADDRESSES: You may submit comments, identified by “Prediction Markets” and RIN 3038-AF65, by any of the following methods:
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• CFTC Comments Portal : https://comments.cftc.gov. Select the “Submit Comments” link for this release and follow the instructions on the Public Comment Form. • Mail : Send to Christopher Kirkpatrick, Secretary of the Commission, Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street, NW, Washington, DC 20581. • Hand Delivery/Courier : Follow the same instructions as for Mail, above. Please submit your comments using only one of these methods. Submissions through the CFTC Comments Portal are encouraged. All comments must be submitted in English, or if not, accompanied by an English translation. Comments will be posted as received to https://comments.cftc.gov. You should submit only information that you wish to make available publicly. If you wish the Commission to consider information that you believe is exempt from disclosure under the Freedom of Information Act (FOIA), a petition for confidential treatment of the exempt information may be submitted according to the procedures established in § 145.9 of the Commission's regulations. 1 The Commission reserves the right, but shall have no obligation, to review, pre- screen, filter, redact, refuse or remove any or all of your submission from https://comments.cftc.gov that it may deem to be inappropriate for publication, such as obscene language. All submissions that have been redacted or removed that contain comments on the merits of the rulemaking will be retained in the public comment file and
1 17 CFR 145.9.
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will be considered as required under the Administrative Procedure Act and other applicable laws, and may be accessible under FOIA. FOR FURTHER INFORMATION CONTACT: Mark Fajfar, Senior Assistant General Counsel, 202-418-6636, mfajfar@cftc.gov , Office of the General Counsel, Commodity Futures Trading Commission, Three Lafayette Centre, 1151 21st Street, NW, Washington, DC 20581. SUPPLEMENTARY INFORMATION: Table of Contents I. Background A. Prediction Markets B. Statutory and Regulatory Requirements C. Past Commission Notices Regarding Prediction Markets II. Questions and Request for Comment A. Core Principles and Commission Regulations B. Public Interest
C. Activities Listed in CEA Section 5c(c)(5)(C) D. Procedural Aspects of CEA Section 5c(c)(5)(C) E. Inside Information F. Types of Event Contracts and Other Issues
I.
Background A. Prediction Markets
On prediction markets, participants buy and sell contracts based on whether events stated in the contracts occur. Prediction markets “function as information aggregation vehicles” because the contract prices will reflect the market participants’ aggregate beliefs regarding whether the events will occur. 2
2 See Concept Release on Appropriate Regulatory Treatment of Event Contracts, 73 FR 25669, 25669 (May 7, 2008) (2008 Concept Release).
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As discussed further below, the contracts traded on prediction markets may fall within the definition in the Commodity Exchange Act (CEA) of the term “swap.” 3 The contracts may also be contracts for the future delivery of a commodity (futures contracts) that are covered by the CEA. 4 A prediction market which offers swaps or futures contracts for trading by the general public must register with the CFTC as a designated contract market (DCM), which the Commission is charged with overseeing. 5 Since the early 1990s, parties have sought Commission staff guidance regarding prediction markets, and the Commission first designated a prediction market as a DCM in February 2004. 6 While the term “event contract” is not a defined term in the CEA or the CFTC’s regulations thereunder, the CFTC has used this term to describe derivative contracts, typically with a binary payoff structure, based on the outcome of an underlying
3 See CEA section 1a(47), 7 U.S.C. 1a(47). 4 See CEA section 2a(1)(A), 7 U.S.C. 2(a)(1)(A).
5 See Id. , which expressly extends the CFTC’s “exclusive jurisdiction” to encompass “transactions involving swaps or contracts of sale of a commodity for future delivery … traded or executed on a contract market designated pursuant to [CEA section 5, 7 U.S.C. 7] ….” The CFTC shares jurisdiction over mixed swaps and security futures with the Securities and Exchange Commission (SEC), and the SEC has sole jurisdiction over security-based swaps. See section 1a(44) of the CEA, 7 U.S.C. 1a(44) and sections 3(a)(55) and 3(a)(68) of the Securities Exchange Act of 1934 (Exchange Act), 15 U.S.C. 78c(a)(55) and 78c(a)(68). See also section 712(d)(1) of Title VII of the Wall Street Transparency and Accountability Act of 2010 (Dodd-Frank Act) (directing the CFTC and SEC to undertake joint rulemaking on covered topics). 6 See CFTC Order of Designation for HedgeStreet, Inc. (Feb. 20, 2004), available at https://www.cftc.gov/sites/default/files/opa/press04/opa4894-04.htm . The Commission’s Division of Market Oversight issued staff no-action positions to two academic institutions. The no-action positions provide that, subject to specified terms, staff will not recommend enforcement action for operating prediction markets, without registration as a DCM, swap execution facility, or foreign board of trade, that offer trading in political and economic indicator event contracts for academic purposes. See CFTC Staff Letter No. 93-66 issued to the University of Iowa (June 18, 1993), available at https://www.cftc.gov/sites/default/files/idc/groups/public/@lrlettergeneral/documents/letter/93-66.pdf . This no-action position superseded a more limited no-action position issued in 1992. See also CFTC Staff Letter No. 14-130 issued to Victoria University of Wellington, New Zealand (Oct. 29, 2014), available at https://www.cftc.gov/csl/14-130/download .
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occurrence or event since at least 2008. 7 In this document, the term “prediction market” refers to a CFTC-registered DCM or swap execution facility (SEF) that offers event contracts for trading. 8 Since 2021, the Commission has observed a significant increase in the number of event contracts listed for trading on prediction markets, as well as in the diversity of occurrences and events underlying such contracts. 9 The Commission has also received recent applications for DCM registration, and expressions of interest regarding DCM registration, from entities that have indicated that they are interested primarily, or exclusively, in operating prediction markets. 10 As noted above, event contracts can fall within multiple subsections of the CEA’s definition of “swap.” CEA section 1a(47)(A)(ii) defines “swap” to include “any agreement, contract, or transaction . . . that provides for any purchase, sale, payment, or delivery (other than a dividend on an equity security) that is dependent on the occurrence, nonoccurrence, or the extent of the occurrence of an event or contingency associated with 7 See 2008 Concept Release. See also Contracts & Products: Event Contracts, available at https://www.cftc.gov/IndustryOversight/ContractsProducts/index.htm . 8 In addition to DCMs, a SEF may make any swap, including an event contract, available for trading. See CEA section 5h, 7 U.S.C. 7b-3. However, swap trading on a SEF is not available to the general public, but rather only to institutional investors within the definition of “eligible contract participant” in CEA section 1a(18), 7 U.S.C. 1a(18). 9 From 2006-2020, DCMs listed for trading an average of approximately five event contracts per year. In 2021, this number increased to 131, and the number of newly-listed event contracts per year remained at a similar level until 2025, when DCMs certified approximately 1,600 event contracts for listing for trading. These event contracts are based on a wide variety of financial indices, economic indicators, weather events, political events, international events, scientific and cultural events, current events, and sporting events. A list of event contracts certified for listing is available on the CFTC’s web site. See https://www.cftc.gov/IndustryOversight/IndustryFilings/TradingOrganizationProducts?Status=Certified& Category=Event . 10 As of March 2026, Commission staff are reviewing several pending applications for DCM designation from entities with a stated interest in operating prediction markets. Commission staff have received multiple additional inquiries from other entities indicating an interest in applying for DCM registration in order to operate prediction markets.
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a potential financial, economic, or commercial consequence.” 11 Also, CEA section 1a(47)(A)(i) defines the term “swap” to include “any agreement, contract, or transaction . . . that is a put, call, cap, floor, collar, or similar option of any kind that is for the purchase or sale, or based on the value, of 1 or more interest or other rates, currencies, commodities, securities, instruments of indebtedness, indices, quantitative measures, or other financial or economic interests or property of any kind.” 12 Event contracts traded as swaps under CEA section 1a(47)(A)(i) are sometimes referred to as binary options, a type of swap which is an “option whose payoff is either a fixed amount or zero.” 13 Prediction markets can also list event contracts for trading as futures contracts. 14 Since futures contracts are specifically excluded from the statutory definition of “swap,” these event contracts are not swaps. 15 Although the event contracts listed on CFTC-registered DCMs and SEFs are swaps or futures contracts subject to the jurisdiction of the CFTC, 16 other event contracts referencing events associated with potential financial, economic or commercial
11 7 U.S.C. 1a(47)(A)(ii). 12 7 U.S.C. 1a(47)(A)(i). 13 See CFTC Futures Glossary, available at https://www.cftc.gov/LearnAndProtect/AdvisoriesAndArticles/CFTCGlossary/index.htm#B . 14 See CEA section 2a(1)(A), 7 U.S.C. 2(a)(1)(A). A list of event contracts certified for listing as futures contracts is available on the CFTC’s web site. See https://www.cftc.gov/IndustryOversight/IndustryFilings/TradingOrganizationProducts?Type=Future&Cate gory=Event . 15 CEA section 1a(47)(B), 7 U.S.C. 1a(47)(B), provides that “[t]he term ‘swap’ does not include – (i) any contract of sale of a commodity for future delivery (or option on such contract) ….” 16 See supra , note 5.
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consequences may be security-based swaps or other instruments subject to the jurisdiction of the SEC. 17 B. Statutory and Regulatory Requirements A prediction market that seeks to list event contracts for trading, or make event contracts available for clearing, must comply with the substantive and procedural requirements that apply, more generally, to the listing for trading, or making available for clearing, of derivative contracts. 18 Further, a prediction market is subject to statutory requirements to only list or permit trading in derivative contracts that are not readily susceptible to manipulation; 19 to enforce compliance with contract terms and conditions; 20 and to monitor trading on the exchange in order to prevent manipulation, price distortion, and disruption of the settlement process through market surveillance, compliance, and enforcement practices and procedures. 21 In addition to the more generally applicable requirements to which registered entities are subject when listing derivative contracts for trading or making such contracts available for clearing, CEA section 5c(c)(5)(C) grants the Commission the authority to prohibit prediction markets from listing for trading or making available for clearing 17 See 7 U.S.C. 1a(47)(B) (providing “exclusions” from the definition of “swap” under the CEA, including for securities such as security based-swaps, certain options, and debt securities); see also, e.g. , 15 U.S.C. 78c(a)(68)(A) (defining “security-based swap” under the Exchange Act). 18 For example, Regulation 40.2, 17 CFR 40.2, sets forth the general process by which a DCM or SEF may list a new derivative contract for trading by providing the Commission with a written certification. See also infra , note 27. 19 See Core Principle 3 for DCMs, CEA section 5(d)(3), 7 U.S.C. 7(d)(3), and Core Principle 3 for SEFs, CEA section 5h(f)(3), 7 U.S.C. 7b-3(f)(3). 20 See Core Principle 2 for DCMs, CEA section 5(d)(2), 7 U.S.C. 7(d)(2), and Core Principle 2 for SEFs, CEA section 5h(f)(2), 7 U.S.C. 7b-3(f)(2). 21 See Core Principle 4 for DCMs, CEA section 5(d)(4), 7 U.S.C. 7(d)(4), and Core Principle 4 for SEFs, CEA section 5h(f)(4), 7 U.S.C. 7b-3(f)(4).
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particular types of event contracts, if the Commission determines that such contracts are contrary to the public interest. 22 Specifically, CEA section 5c(c)(5)(C)(i) provides that, “[i]n connection with the listing of agreements, contracts, transactions, or swaps in excluded commodities[ 23 ] that are based upon the occurrence, extent of an occurrence, or contingency (other than a change in the price, rate, value, or levels of a commodity described in [CEA] section la(2)(i)),[ 24 ] by a [DCM] or [SEF], the Commission may determine that such agreements, contracts, or transactions are contrary to the public interest if the agreements, contracts, or transactions involve—(I) activity that is unlawful under any Federal or State law; (II) terrorism; (III) assassination; (IV) war; (V) gaming; or (VI) other similar activity determined by the Commission, by rule or regulation, to be contrary to the public interest.” 25 In 2011, the Commission adopted final rules under part 40 of the Commission’s regulations, including new Regulation 40.11. 26 The Commission adopted 22 7 U.S.C. 7a-2(c)(5)(C). 23 The term “excluded commodity” is defined in CEA section 1a(19), 7 U.S.C. 1a(19), as: “(i) an interest rate, exchange rate, currency, security, security index, credit risk or measure, debt or equity instrument, index or measure of inflation, or other macroeconomic index or measure; (ii) any other rate, differential, index, or measure of economic or commercial risk return, or value that is—(I) not based in substantial part on the value of a narrow group of commodities not described in clause (i); or (II) based solely on one or more commodities that have no cash market; (iii) any economic or commercial index based on prices, rates, values, or levels that are not within the control of any party to the relevant contract, agreement, or transaction; or (iv) an occurrence, extent of an occurrence, or contingency (other than a change in the price, rate, value, or level of a commodity not described in clause (i)) that is—(I) beyond the control of the parties to the relevant contract, agreement, or transaction; and (II) associated with a financial, commercial, or economic consequence.” 24 There is no “section 1a(2)(i)” in the CEA. The Commission believes that the reference in CEA section 5c(c)(5)(C)(i) to “section 1a(2)(i)” is a typographical or drafting error. 25 7 U.S.C. 7a-2(c)(5)(C)(i). CEA section 5c(c)(5)(C)(ii), 7 U.S.C. 7a-2(c)(5)(C)(ii), further provides that “[n]o agreement, contract or transaction determined by the Commission to be contrary to the public interest under clause (i) may be listed or made available for clearing or trading on or through a registered entity.” 26 Provisions Common to Registered Entities, 76 FR 44776 (July 27, 2011).
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