The American Gaming Association (AGA), the premier national trade group representing the $261 billion U.S. casino industry, has sent an email accusing the prediction market industry of costing state governments in excess of $1 billion in revenue.
The group’s CEO, Bill Miller, believes communities, such as Native American tribes, are feeling the direct consequence of prediction market interference.
“States and tribes that are losing literally a billion dollars today”
In the email sent by the AGA on Thursday, Miller was quoted: “We recently had 41 attorneys general from around the country weighing in saying the Commodity Futures Trading Commission (CFTC) plays an important role in the nation’s economy, but they’re not the regulator of national sportsbooks,
“Forty-one attorneys general, that’s from every political stripe that there is in this country. It’s not about the AGA or the gaming industry, it’s about states and tribes that are losing literally $1 billion in state and tribal revenue that would otherwise go to fund important community projects and pay taxes to these states.”
Earlier this year, the AGA Commercial Gaming Revenue Tracker found the U.S. commercial gaming industry reached a record high in 2025, generating $78.72 billion in gross gaming revenue (GGR), a 9.2 percent increase over the previous year.
The commercial gaming industry posted record growth across all major segments. Traditional gaming revenue rose 2.3% to $50.94 billion, while sports betting revenue jumped 22.8% to $16.96 billion on nearly $167 billion in wagers. iGaming revenue climbed 27.6% to $10.74 billion.
The sectors collectively generated billions in state tax revenue, and all 38 commercial gaming markets reported annual revenue gains, highlighting continued consumer demand for legal, regulated gambling.
As part of those figures, the AGA estimated prediction markets had diverted more than $500 million in potential sports betting tax revenue to date. “Sports betting belongs under state and tribal regulation,” AGA President and CEO Bill Miller said at the time.
Coalition for Prediction Markets posts withering response
In a sarcastic response on the social media platform X, the Coalition for Prediction Markets poured scorn on the claims, posting: “Error 404: sources not found”.
Kalshi spokesperson Elisabeth Diana was also unconvinced. In a statement released by Kalshi, she said: “This is fake math from casinos, who are worried about losing their monopoly power. Square that ‘math’ with the fact that the U.S. gaming industry reached a record high last year — $78.7 billion in revenue,
“This is an industry that preys on people who lose. Of course they’re OK spreading lies. People are coming to prediction markets because they’re fairer, safer and less predatory than casinos.”
Prediction markets surged in popularity last year, generating nearly $64 billion in trading volume, up from less than $16 billion a year earlier, according to data from Next.io.
Monthly trading volume climbed dramatically from under $100 million in early 2024 to more than $13 billion by December 2025, reflecting the sector’s rapid expansion from a niche product into a mainstream wagering and trading market.
Sports-related event contracts accounted for more than 80% of all prediction market activity, the report found. During the most recent Super Bowl alone, prediction markets handled more than $6 billion in trading volume, including over $1 billion on game day. Data from gaming analytics firm Blask also showed online search interest in prediction markets nearly doubled between October 2025 and January 2026 and was nearly four times higher than levels recorded in September 2025.
CFTC to sue state of Rhode Island
Meanwhile, the CFTC sued Rhode Island on Thursday, escalating a legal fight over who has authority to regulate prediction markets. The move came one week after Rhode Island Attorney General Peter Neronha sued prediction market platforms Kalshi and Polymarket over sports-related event contracts.
The CFTC said Rhode Island’s actions infringe on the agency’s authority to regulate swaps, derivatives and event contracts under federal law. The agency is seeking to intervene in the state’s lawsuit against the platforms and also filed its own complaint against Rhode Island. The case marks the seventh state sued by the CFTC in disputes tied to prediction markets.
“CFTC-registered exchanges have faced an onslaught of lawsuits seeking to limit Americans’ access to event contracts and undermine the CFTC’s sole regulatory jurisdiction over prediction markets,” CFTC Chairman Michael Selig said. “This power grab ignores the law and decades of precedent.”
Neronha argued the companies are operating outside Rhode Island’s sports betting laws. “We allege that Kalshi and Polymarket are operating outside of our sports betting laws, and ultimately, Rhode Islanders will be footing the bill for their actions,” he said in a statement. “We are confident in our case and are ready to go on behalf of Rhode Islanders.”
Eighteen states are now involved in litigation tied to prediction markets, with Minnesota moving to ban them outright. President Donald Trump said in a social media post Tuesday that the CFTC’s “exclusive jurisdiction” over prediction market regulation must be preserved.
