Nevada's Stance on Prediction Markets Amid Legal Challenges

Nevada Gaming Control Board Chairman Mike Dreitzer says prediction market operators are committing crimes, and he’s warning tribes and gaming operators against hedging their bets on the industry while its legal fight heads toward the Supreme Court. “There’s no plan B for crime, and [we’re] standing up for the rule of law,” he said Wednesday on The New Normal podcast.

Dreitzer joined Indian Gaming Association Conference Chairman Victor Rocha and Executive Director Jason Giles, along with tribal gaming attorney Scott Crowell of Crowell Law Offices Tribal Advocacy Group, to discuss the clash between prediction markets and the regulated sports betting industry.

The conversation came days after the Commodity Futures Trading Commission issued an interim final rulemaking on Oct. 9 that excludes casino-style gambling products, including sportsbook wagers and casino games, from the definition of a swap.

Why Nevada won’t budge on a plan B

Kalshi started offering sports event contracts nationwide in 2025, even in jurisdictions where sports betting is not legal. Users as young as 18 can trade on sports outcomes on the platform.

Dreitzer said Kalshi and other prediction markets are “acting and creating illegal sportsbooks,” adding, “it’s crime, it’s not innovation.”

Much of the regulated gaming industry has united against prediction markets, putting commercial operators and most tribes, which often find themselves on opposite sides of gaming issues, in rare agreement. MGM Resorts and Caesars Entertainment have also held firm, not risking their casino licenses to enter the prediction market space as FanDuel and DraftKings have.

Still, Giles said tribes at G2E asked whether there’s a plan B if states and tribes lose at the Supreme Court, concerned about being left behind. Some have already decided to jump ship with multiple tribes partnering with Kalshi this month, although one tribe in the announcement denied any relationship with the prediction market operator. "I am fully sympathetic to tribes, and, frankly, too, some of our licensees who have followed the rules and stood for the rule of law,” Dreitzer said. “And they’ve done so, understandably, frankly, at a potential short-term detriment to themselves. I get that, and I feel for that.”

But Dreitzer said the industry has to hold the line. “We need to meet the moment as the states and tribes have done collectively. This is our hardest hour and our finest hour,” Dreitzer said. “… There is no other choice, and we are on the right side of this, and we’re gonna win.”

Legal perspective on plan B

Dreitzer isn’t planning for a loss at the Supreme Court. However, with a circuit split, it’s entirely possible the Supreme Court rules in favor of prediction markets.

Kalshi already has a favorable Third Circuit ruling in New Jersey and won a preliminary injunction in Illinois earlier this month. Still, states have won the majority of rulings, including the most impactful ones at the Sixth and Ninth Circuits.

If the Supreme Court does side with prediction markets, Crowell believes there could still be a fix. “If we lose in federal court, we’re going to be looking at Congress,” Crowell said. “I think Congress is more likely to fix the error.”

Crowell said if Congress did intend for a federal gaming regulator, it would need to make sure that agency has the “expertise and tools that are necessary, which the CFTC certainly does not have.”

The NFL agrees, noting in its amicus brief to the Supreme Court that the CFTC had only 543 employees as of September 2025. State gaming boards in Nevada and Pennsylvania each employ close to 400 people in each state alone to regulate gambling.

Give them an inch…

The CFTC’s interim final rule codifies what the agency calls its longstanding position that casino-style gambling products, including sportsbook wagers and casino games, are excluded from the definition of a swap.

“Casino-style gambling products are not derivatives,” CFTC Chairman Michael Selig said in announcing the rule.

The rule takes effect immediately upon publication in the Federal Register, with a 30-day public comment period to follow. It came alongside a proposed rule that would further define a swap to include event contracts tied to sports, politics, culture and weather. Selig said those contracts fall “within the agency’s exclusive jurisdiction.”

Taken together, the two measures draw a line between a sports bet placed at a sportsbook and a sports event contract traded on a prediction market. That’s the same distinction Dreitzer and the rest of the regulated industry have rejected.

“I’ve never seen something like this. It’s a disgrace to democracy,” Giles said. “This is weaponization of an agency. It’s Orwellian, because you read this whole thing, and they just start with their premise and literally create the law from what they believe, and tell two courts that they’re wrong and tell all these states that they’re wrong.”

Dreitzer also doesn’t expect the casino-style exclusion to last.

“They’ll just get away with what they can get away with,” he said. “So it’s important that we stand up straight away to all of it.”

He said if prediction markets could secure a rule in six months allowing some form of casino-style gambling as a prediction market contract, “they’ll do it. I have no doubt about it.”