The story examines the legal battle over whether prediction markets should be regulated federally as financial products or by states under gambling laws, a dispute that could ultimately reach the Supreme Court.

Key Takeaways:

• Conflicting federal court rulings have intensified the debate over whether sports-related prediction contracts fall under federal commodities law or state gambling regulations.
• Bakowicz argues that prediction markets increasingly resemble sports betting, particularly because sports account for a significant share of activity on major platforms.
• With states, federal regulators and prediction-market operators pursuing competing approaches, Bakowicz said congressional action may be needed to establish clearer rules for the industry.

 “At the end of the day, where we have a situation that we're in is these two products, sports betting and Kalshi, can't stay in the same arena and can't govern themselves, it's time for Congress to step in,” Bakowicz said.

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