Bipartisan Senate Bill Targets Prediction Markets Over Consumer Protection Concerns

A bipartisan Senate bill has been introduced to restrict prediction markets, which have seen rapid expansion in the crypto sector. According to a report by The Wall Street Journal, the legislation would prohibit Commodity Futures Trading Commission (CFTC)-regulated entities like Kalshi and Polymarket from listing contracts tied to sporting events.

The proposal marks the first bipartisan Senate effort to directly address prediction markets, which have been criticized for bypassing state-level consumer protection. Lawmakers backing the bill argue that sports-related contracts on federally regulated platforms resemble traditional betting products, operating outside state frameworks.

Crypto exchanges, including Coinbase and Robinhood, have recently launched or announced plans to enter prediction markets. Both companies have allowed for sports betting on their platforms via partnerships with Kalshi. The new legislation could put a dent in their plans to expand revenue streams beyond cryptocurrency trading.