Gaming & Gambling Update - Week of March 24, 2025

• Prediction Markets Developments
• Responsible Gaming Efforts
• Some Member of Congress Seek to Ban Collegiate Player Prop Bets

Prediction Markets Developments

Kalshi's sports betting prediction market, in partnership with Robinhood, has seen significant success, reporting $249 million in contracts during the first two rounds of the NCAA College Basketball Tournament. Kalshi's activity already represents about 8% of the American Gaming Association’s estimated $3.1 billion in legal wagering for the tournament, despite the platform being newly launched.

Kalshi has announced, that, as part of its commitment to game integrity and responsible gaming, plans to introduce a "consumer protection hub" for users to self-exclude and set deposit limits.

The CFTC-planned discussion on prediction markets is expected to take place before the end of April.

These recent forays into sports have precipitated regulatory notice, as the Nevada Gaming Control Board (“NGCB”) sent a cease-and-desist order to Kalshi, alleging that Kalshi’s sports-themed prediction markets amount to unlicensed sports betting in the state. Kalshi requested an extension of the initial deadline, which was granted by the NGCB. Additionally, the Massachusetts Secretary of the Commonwealth, whose office regulates securities, announced on March 24^th that an investigation had been launched into how Robinhood is marketing its predictions-markets hub to its current customers.

Responsible Gaming Efforts 

With Americans betting more on sports than ever, responsible gambling efforts are gaining attention from legislators, regulators and sportsbooks. The American Gaming Association estimates $3.1 billion will be wagered on the NCAA Tournament, doubling the Super Bowl betting handle. In 2024, Americans wagered $147.9 billion on sports. March is designated as Problem Gambling Awareness Month by the National Council on Problem Gambling, highlighting the need for prevention and treatment services for the 2.5 million Americans with severe gambling problems.

State regulators and sportsbooks are enhancing responsible gambling initiatives, with market leaders FanDuel and DraftKings both releasing Responsible Gaming-focused campaigns coinciding with the NCAA tournament. FanDuel, through its FanDuel TV channel, launched "The Comeback with Craig Carton," focusing on problem gambling recovery, while DraftKings initiated a campaign built around the Kenny Roger’s classic “The Gambler.” The Responsible Online Gaming Association, a consortium of leading online operators, also launched the "Know Your Play" campaign, which specifically seeks to educate college-aged bettors as to responsible gaming, mental health and well-being, and financial literacy.

Efforts to curb unregulated operators are also underway, with states like Michigan and Nevada taking action against offshore sportsbooks and unlicensed operators. These initiatives reflect a broader push to ensure responsible gambling and protect the integrity of sports betting.

Some Members of Congress Seek to Ban Collegiate Player Prop Bets

The "Providing Responsible Oversight and Transparency and Ensuring Collegiate Trust for Student Athletes Act" (PROTECT Act) was introduced on February 25 by Congressman Michael Baumgartner (R-WA), who also chairs the college sports caucus. The bill targets wagers on individual performances of student athletes, rather than banning betting on college sports entirely. Baumgartner’s stated motivation for introducing the legislation was in response to concerns raised by the NCAA about harassment and coercion of student athletes to manipulate game outcomes for financial gain.

In contrast, the previously introduced SAFE Bet Act, sponsored by Representative Paul Tonko (D-NY) and Senator Richard Blumenthal (D-CT), seeks to ban all prop betting. Baumgartner's bill focuses specifically on college sports, aiming to protect amateur athletes from harassment. The Federal Trade Commission would enforce the rules, treating violations as unfair business practices. The introduction of the PROTECT Act comes amid growing discussions about the impact of gambling on college athletics.