Tribal gaming regulators and members of Congress are pressing for specific language in the pending CLARITY Act to prevent prediction markets from offering sports and casino-style contracts outside existing state and tribal oversight.
The call came during a Senate Committee on Indian Affairs roundtable held on August 4, 2026, titled “Tracking Prediction Markets’ Exponential Growth: Tribal Implications and Beyond.”
Indian Gaming Association Vice Chairman Tehassi Hill, who also chairs the Oneida Nation, told lawmakers that prediction markets have exploited regulatory gaps to deliver nationwide online sports gambling.
He stressed that Indian Country supports legitimate financial innovation and risk-hedging tools but strongly opposes products that function as unregulated wagering available to adults as young as 18.
Hill urged two concrete steps. First, advance separate legislation addressing prediction markets as gambling.
Second, ensure the CLARITY Act—the major cryptocurrency market-structure bill—explicitly stops all sports and casino gambling conducted through prediction markets while confirming that the Indian Gaming Regulatory Act (IGRA) and state and tribal gaming laws remain fully in force.
Senator Tina Smith of Minnesota highlighted available legislative pathways.
She noted that Congress could clarify in either the CLARITY Act or the Farm Bill that the Commodity Futures Trading Commission (CFTC) and the Commodity Futures Act do not preempt IGRA or tribal-state contracts.
Prediction markets, she said, must simply follow existing law—a step she described as straightforward and non-controversial.
The discussion reflects a larger dispute.
Platforms such as Polymarket and Kalshi have grown rapidly by offering event contracts on sports outcomes under CFTC jurisdiction.
Operators treat these as financial instruments.
Tribal and state gaming interests maintain that sports-related contracts amount to unlicensed sports betting that undermines the carefully negotiated framework of IGRA, tribal-state compacts, and state regulations.
Gaming revenues fund critical tribal services including health care, education, housing, and public safety, and support hundreds of thousands of jobs, many in rural communities.
Senate Agriculture Committee Chair John Boozman acknowledged concerns about underage access and market integrity but resisted attaching prediction-market language to the CLARITY Act or Farm Bill.
He argued that cryptocurrency regulation and prediction markets present distinct issues and that advocates should build a separate case rather than conflate the two.
With the Senate racing against an imminent recess and the November elections, the window for amendments is narrow.
Tribal leaders view the CLARITY Act as a timely vehicle to reaffirm that sports and casino-style activity belongs under state and tribal authority rather than federal commodities regulation. The outcome will help determine whether prediction markets continue expanding under a federal financial label or face clearer boundaries that protect established gaming systems.