Prediction Platforms Unite: Major Coalition Forms to Defend Against Regulatory Onslaught

They saw the writing on the wall—and decided to write back. A powerful new alliance of leading prediction platforms is mobilizing, forming a united front against what they see as an escalating regulatory siege. This isn't just a trade group; it's a strategic coalition built for a fight.

The Battle Lines Are Drawn

Regulators worldwide are sharpening their knives, targeting the prediction sector with a fresh wave of scrutiny and proposed rules. The usual playbook—individual companies lobbying in isolation—hasn't worked. Now, the major players are pooling resources, legal firepower, and political capital to push back collectively. It's a classic move: consolidate to survive.

A Shared Defense Strategy

The coalition's game plan focuses on three fronts: crafting a unified self-regulatory framework to pre-empt heavy-handed government rules, launching a coordinated public relations campaign to reframe the narrative around innovation and consumer choice, and establishing a joint legal fund. The message is clear: we'll regulate ourselves, thank you very much—or at least make it too costly and messy for you to do it for us.

What This Means for the Ecosystem

For users, this could mean more consistent rules across platforms and a stronger, more resilient sector. For the platforms, it's about preserving autonomy and their very business models. For regulators, it presents a new, formidable counterparty across the table. The era of picking off platforms one by one might be over.

A cynical take? It's the ultimate hedge. By banding together, they're not just fighting regulation—they're building a moat. New entrants will face not only regulatory hurdles but also a wall of established players who've already written the rulebook to suit themselves. Classic finance: disrupt the system, then build a cartel to protect your patch. The coalition's success or failure will signal whether decentralized prediction markets can carve out a permanent space, or if they'll be slowly regulated into a corner—another innovative idea smoothed into irrelevance by the bureaucratic machine.

Are states against prediction markets?

Kalshi, Crypto.com, Coinbase, Robinhood, and Underdog have announced the formation of The Coalition for Prediction Markets to protect safe, transparent, and federally supervised access to prediction markets.

According to Kalshi founder Tarek Mansour, the coalition was created to provide a voice for prediction markets against adverse lobbying groups and to protect the transparency and customer protection standards within the industry.

As it stands, nearly half of Americans under 45 have already used an online financial or prediction market. The industry has seen explosive growth, and platforms now record billions in weekly trading volume. Prediction markets have reached over $150 billion in annualized volume. They allow users to trade contracts based on real-world events ranging from sports outcomes to elections.

The platforms are currently regulated by the Commodity Futures Trading Commission (CFTC) at the federal level, which distinguishes them from state-regulated gambling operations.

However, the nascent industry is taking punches from multiple fronts.

The American Gaming Association (AGA), which represents major casino operators like MGM and Caesars, launched campaigns describing prediction markets as unlawful sports betting operating without proper state licenses. The AGA and many of its members have warned that platforms with contracts tied to sports events undermine regulated betting.

States including Massachusetts, Washington, New York, and Connecticut have taken legal action against prediction market operators. Gaming regulators in these states argue that sports-related event contracts should be treated as gambling and subject to state licensing requirements.

“Americans deserve clarity, not 50 conflicting interpretations,” Sara Slane, an Executive Board Member of the Coalition and Head of Corporate Development at Kalshi, stated.

Matt David, the President of North America at Crypto.com and an executive board member of the coalition, described prediction markets as a way to help people and institutions make better decisions. The coalition will focus on educating policymakers and the public about how prediction markets differ from traditional gambling.

Is the sports betting industry getting along with prediction markets?

In November, DraftKings and FanDuel both resigned from the American Gaming Association specifically because of disagreements over how prediction markets should be regulated. Both companies view the growing sports prediction markets as a significant growth opportunity and are putting in efforts to break into it.

FanDuel announced it was partnering with Wall Street firm CME Group to launch a prediction markets platform in December. The platform will provide users with contracts for baseball, basketball, football, and hockey in all states, including those where sports betting remains illegal.

DraftKings acquired prediction market platform Railbird in October and plans to launch DraftKings Predictions. PrizePicks, Underdog, and Fanatics have all introduced or announced prediction market products.

Sources told CNBC that the AGA’s board was considering a rule change that WOULD exclude any operator involved in prediction markets from membership.

Polymarket, one of the largest prediction market platforms globally, is notably absent from the new coalition, but according to the announcement, other companies are currently in discussion to join the collective.

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