The Nevada Gaming Control Board (NGCB) issued an official warning stating that offering prediction market contracts for sports, elections, or popular culture events constitutes "betting activities" in the state, and licensed institutions may face disciplinary action. NGCB became the third state regulatory agency to issue a warning about prediction markets in 2025, following similar actions by Ohio and Michigan. The warning emphasizes that contracts are subject to state gambling regulations regardless of whether they are listed on CFTC-regulated exchanges. Nevada is currently involved in multi-threaded legal proceedings with prediction platforms such as Kalshi, Crypto.com, and Robinhood, with some cases reaching the appeal stage. NGCB Chairman Mike Dreitzer expressed a willingness to introduce innovation in a compliant manner, but industry organizations strongly oppose prediction markets, citing a lack of regulation and consumer protection.
Regulatory Warning and Legal Basis
The Nevada Gaming Control Board (NGCB) issued a formal notice warning licensed institutions that offering prediction market contracts may violate state gambling regulations. The committee explicitly stated that contracts based on sports events, political elections, or cultural activities constitute "betting activities" and are subject to state law.
The notice emphasizes that whether the contract is listed on the Commodity Futures Trading Commission (CFTC) exchange, it belongs to the category of gambling activities, and licensed institutions must comply with relevant regulations.
Multi-State Regulatory Trends and Background
Nevada is the third state to issue a regulatory warning about prediction markets in 2025, following similar actions by Ohio and Michigan. The stricter multi-state regulation reflects widespread concerns about the compliance of prediction markets.
NGCB Commissioner George Assad stated at the October hearing that prediction markets are "just sports bets" and should be under the jurisdiction of the state gaming commission, echoing the regulatory stance.
Legal Litigation and Platform Responses
Nevada is involved in legal proceedings with several prediction market platforms. The state government issued a cease and desist order to Kalshi in March, Kalshi filed a lawsuit and obtained a preliminary injunction in April allowing it to continue operations, and the case is currently on appeal.
Crypto.com and Robinhood also received cease and desist orders and filed lawsuits, with Crypto.com's injunction request being rejected by the judge, and the Robinhood case has not yet been decided.
Regulatory Stance and Enforcement Measures
NGCB stated that licensed institutions that offer prediction market contracts or reach related partnerships may face applicability assessments and disciplinary actions. The only exception is entities that hold an unrestricted sports betting license and meet all requirements.
The committee specifically pointed out that contracts for sports events, the World Series of Poker, the Oscars, esports, and political elections all fall within the jurisdiction.
Industry Attitudes and Discrepancies
Industry organizations such as the Nevada Resort Association strongly oppose prediction markets, citing a lack of regulation, consumer protection, and responsible gambling requirements, and they do not pay state income tax. The association has participated as an intervener in the state government's appeal against Kalshi.
Large operators such as Caesars Sportsbook and BetMGM avoid large-scale investments in prediction markets and have not publicly expressed support or interest.
Regulatory Agency Leadership Views
NGCB Chairman Mike Dreitzer stated at the G2E Gaming Expo that Nevada is "open for business" for innovation and hopes to introduce prediction markets in a compliant manner. He emphasized: "We want to foster innovation, but it must comply with legal requirements."
Dreitzer's stance is more open than Commissioner Assad's, but he emphasized that any introduction must comply with the state legal framework.
Federal and State Jurisdiction Disputes
The core dispute in legal litigation is whether federal commodity law takes precedence over state gambling law. The judge in the Kalshi case believed that the federal priority argument might prevail, but in the Crypto.com case, he expressed doubts about the application of the "swap" definition to sports contracts.
Jurisdiction issues have become a key legal dispute point for the legality of prediction markets, with specific arguments varying slightly between cases.
Market Participation and Cooperation Dynamics
Large operators such as FanDuel and DraftKings have not operated in Nevada because the state requires on-site account registration. Some companies, such as FanDuel, have reached agreements with the CME Group, and Underdog is exploring prediction markets in cooperation with Crypto.com.
However, most traditional operators take a cautious attitude, avoiding large-scale investments or commitments.
Consumer Protection and Compliance Concerns
Opponents mainly worry that prediction markets lack traditional gambling consumer protection measures, responsible gambling requirements, and regulatory oversight. Virginia Valentine, chairman of the Nevada Resort Association, stated that these platforms have "no regulation" or consumer protection.
Supporters believe that prediction markets provide valuable risk hedging tools and should be under the jurisdiction of the CFTC rather than the state gaming commission.
Future Outlook and Regulatory Evolution
NGCB stated that it will continue to assess the legal status and regulatory methods of prediction markets. Chairman Dreitzer emphasized the need to find a solution that balances innovation with compliance, but did not provide a specific timetable or roadmap.
The results of legal litigation and state legislative actions may determine the future fate of prediction markets in Nevada and other regions.
Industry Impact and Strategic Adjustments
Regulatory uncertainty makes operators cautious about investing in prediction markets. Traditional gambling companies may wait for legal clarity before deciding on strategic entry or cooperation methods.
Prediction market platforms need to address multi-state regulatory challenges, possibly adjusting business models or strengthening compliance measures to meet different jurisdictional requirements.
National Trends and Unified Framework
The successive warnings about prediction markets in multiple states reflect a nationwide increase in regulatory attention. The lack of a unified federal framework leads to different approaches by states, increasing business complexity and compliance costs.
The industry may push for clearer regulatory standards or federal guidelines to reduce legal uncertainty and market fragmentation.
