‘This is an all-out war’: Inside the casino industry’s fight to stop prediction markets
This Is an All-Out War: Casinos vs. Prediction Markets
Goldlaner.com – Las Vegas has endured sweltering summers for decades, yet nothing on the Strip this year has rattled its operators quite like the meteoric rise of prediction-market platforms. Industry insiders describe the situation in stark terms: this is an all out war between a century-old wagering economy and a new class of federally licensed trading venues. With tourism already cooling and consumer wallets tightening, casino executives see Kalshi, Polymarket, and similar services—where users stake money on elections, sports scores, and weather outcomes—as an existential threat to their tax-funded regulatory position.
How Prediction Markets Sidestep the State Tax Code
The structural advantage is simple. Backed by the implicit blessing of the Trump administration, these platforms register not with state gaming commissions but with a federal commodity regulator, issuing instruments called “event contracts.” That single licensing choice lets them operate outside the state gambling tax framework that, in the most recent fiscal year, generated roughly $18 billion for state treasuries across the country. For Nevada and its peers, the fiscal math is unforgiving: every dollar wagered on a prediction platform is a dollar that never touches the state coffers funding schools, highways, and public safety.
The casino industry has responded with coordinated aggression. Nearly two dozen executives and operators told reporters that a unified campaign is underway to rein in the sector. Derek Stevens, who controls three Las Vegas properties and the Circa Sports sportsbook brand active in seven states, put the sentiment in blunt language.
“A couple nerds came up with this idea to want to avoid paying taxes,” Stevens said. “Just because they’re shrewd doesn’t mean they should be exempt from the law. These are thieves. They’re pirates. They’re marauders.”
The American Gaming Association, the lobbying arm for most major land-based operators, has poured more than $3.3 million into federal lobbying this year alone—a figure that signals the scale of the mobilization behind Stevens’s rhetoric.
Courts, Congress, and the Counterargument
The legal front broke decisively this summer when a unanimous Ninth Circuit panel upheld states’ authority to regulate prediction platforms under existing gambling statutes, siding with Nevada officials and a coalition of Strip operators. Federal district judges from Connecticut to Wisconsin quickly cited the Nevada precedent in rulings against prediction sites. In Washington, lawmakers introduced five new bipartisan bills this summer, stacking them atop more than a dozen proposals already sitting in committee.
Prediction-market advocates frame the casino offensive as a predictable monopoly reflex. Dean Heller, a former Republican senator from Nevada who now advises Kalshi as a paid consultant, drew parallels to earlier industry campaigns against tribal gaming compacts and online poker.
“This is the game that’s played, and I’ve been part of that game for 30 years,” Heller said. “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.”
Yet the opposition extends well beyond casino lobbies. Forty-four of fifty state attorneys general have called for tighter oversight, joined by dozens of Indian tribes, consumer-protection groups, addiction specialists, and a bipartisan congressional bloc. For state governments the stakes are fiscal and concrete: gaming taxes underwrite public schools and highway maintenance, and an untaxed parallel wagering channel threatens that revenue stream directly.
A Kalshi spokesperson pushed back on the tax-avoidance charge, noting the company pays ordinary state business taxes and pointing to North Carolina’s decision to impose a six-percent levy on prediction-market activity as evidence that states can and do capture revenue when they choose.
Frequently Asked Questions
What exactly is a prediction market?
A prediction market is a platform where participants buy and sell contracts tied to real-world outcomes—elections, sports results, economic data, weather. Prices reflect collective probability estimates, and holders of the correct side collect a fixed payout. Kalshi and Polymarket are the two most prominent U.S. examples.
Why do casinos oppose prediction markets?
Casino operators argue that prediction platforms accept wagers on events without paying state gambling taxes, effectively competing for the same consumer dollars while operating under a lighter federal regulatory regime. The industry contends this erodes the tax revenue that funds public services and undermines the state-by-state licensing framework built over decades.
What has happened legally so far?
A unanimous Ninth Circuit ruling this summer confirmed that states may regulate prediction platforms under existing gambling laws. Multiple federal district courts have since issued adverse rulings against prediction sites, and Congress has added five new bipartisan bills to the more than a dozen already pending in committee.
How much money is at stake?
State gambling taxes delivered approximately $18 billion to state treasuries in the most recent fiscal year. Prediction-market volumes have grown rapidly, though exact figures vary by platform. The American Gaming Association has spent over $3.3 million on federal lobbying this year to shape the regulatory outcome.
