‘This is an all-out war’: Inside the casino industry’s fight to stop prediction markets
With the Trump administration’s blessing, these startups are structured as financial markets for trading, not casinos or sportsbooks for gambling.
Analysts blame Vegas’ slowdown on rising consumer costs, not prediction sites. But the casinos aren’t taking chances. They mobilized for “all-out war,” and have now become a driving force in the nationwide fight to rein in prediction markets, according to nearly 20 sources who spoke with CNN.
“A couple nerds came up with this idea to avoid paying taxes,” says Derek Stevens, who owns three Vegas casinos and Circa Sports, with sportsbooks in seven states. “Just because they’re shrewd doesn’t mean they should be exempt from the law. These are thieves. They’re pirates. They’re marauders.”
There are dozens of cases across the country surrounding the legal status of prediction sites, and experts believe the matter will eventually be decided by the Supreme Court. But before it gets there, everyone is watching Nevada.
Some prediction proponents say casinos are following a losing strategy that they deployed against past innovations and new outlets for gambling, like tribal gaming and online poker.
I thought they crushed online poker on Black Friday
Summary
A casino-backed lawsuit secured the most consequential courtroom victory yet for prediction opponents. On Friday, the Ninth Circuit Court of Appeals unanimously ruled that states can regulate prediction platforms as gambling, siding with Nevada officials and an association of Vegas casinos.
Earlier this summer, in a flurry of rulings against prediction sites from Connecticut to Wisconsin, federal judges cited prior decisions from the Nevada case. And in Congress, lawmakers filed five new bipartisan bills this summer to limit the industry, adding to the dozen-plus pending proposals.
“This is the game that’s played, and I’ve been part of that game for 30 years,” says former Nevada Sen. Dean Heller, a Republican who is now a paid adviser to Kalshi. “This is no different than what we’ve seen. It’s how gaming responds to competition. They don’t like it. They want to have a monopoly.”
Other prediction allies – like Kalshi employees who frequently light up social media – have tried to flatten the narrative by claiming anyone opposing them is doing the bidding of the casino lobby. The well-funded gaming industry has spent over $3.3 million on federal lobbying this year.
But they’re hardly the only ones pushing for more regulation. So are 44 of 50 state attorneys general, dozens of Indian tribes, consumer advocates, addiction experts, and an increasingly bipartisan contingent on Capitol Hill.
The states are worried about losing revenue from gaming taxes that fund schools and highways. A Kalshi spokesperson said it pays state taxes like all companies and noted that North Carolina enacted a 6% tax on prediction platforms that “respects federal law while funding critical state services.”
Polymarket declined to comment for this story. In response to Stevens, a source close to the company tells CNN, “If the gambling lobby is resorting to name-calling, that tells you this is really starting to hurt their wallets.”
CNN has a partnership with Kalshi and uses its data to cover major events. Editorial employees aren’t allowed to participate in prediction markets.
https://archive.ph/DvO0t
this is f’ing incredible
