Most members of the subcommittee raised concerns that existing regulations fail to protect users from exploitation and risks associated with prediction markets, such as gambling addiction. Members explored whether and how markets should implement privacy protections, require age verification and ensure the integrity of the games. The Commodity Futures Trading Commission, which governs these markets, has faced legal challenges over whether states can regulate or ban prediction markets or if federal regulations preempt the states.
So far, in states like Alabama, where sports betting is illegal, residents can still wager money on Kalshi and Polymarket because the companies argue that the commission’s federal jurisdiction supersedes state gambling laws. Rep. Shomari Figures, D-Ala., who sits on the subcommittee, highlighted the distinctions between prediction markets and sports gambling.
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While similar, sports gamblers make bets at fixed odds against a bookmaker, and states have authority to regulate them. In prediction markets, participants use apps and websites to compete against one another by predicting outcomes, and the federal government regulates this type of trading.
“I think predictive markets—they are unique. There are certainly some similarities to traditional sports betting, but there are certainly some differences,” Figures said to Medill News Service after the hearing. ”I think part of today's hearing is giving us the opportunity to explore some more of those differences so that we can craft some legislation and promote a regulatory framework that recognizes those realities.”
Experts described a turf war underway between states and the Commodity Futures Trading Commission over who has the right to regulate prediction markets.
“Are (prediction markets) merely sports gambling by another name, or are they really future markets, just like oil, just like wheat, just like gold, silver?” said Bob Jarvis, a professor of law at Nova Southeastern University who has been focused on gambling law for the past decade. “So far, the CFTC has said the prediction markets come under our jurisdiction, and because we are a federal agency enforcing a federal law under the U.S. Constitution' s supremacy clause, states have to give way because whenever there is a federal agency and a federal statute, state laws are preempted to the extent that the federal law ousts state law.”
In 2018, the Supreme Court overruled a federal ban on sports betting, arguing that it violated states’ rights. The Supreme Court’s ruling allowed states to self-regulate sports betting. But the case also allowed that Congress could bring a new gambling ban in the future. Jarvis said he expected the Supreme Court to take up the issue of state or federal regulation of prediction markets.
“You can legislate and regulate sports betting, but the argument is that this is not sports betting. This is different, and this gets federally regulated,” said Melinda Roth, a professor in sports law at Washington and Lee University. “And that is being litigated in so many different states that are in different federal circuit courts.”
Meanwhile, Alabama has taken center stage in the fight to legalize traditional sports betting. The Sports Betting Alliance is a national organization that advocates for legalizing gambling so that it can be regulated. Some of their goals are to implement privacy protections, require age verification and ensure the integrity of the games.
“Remember — legalized betting would not invent gambling in Alabama, it would just bring it out of the illegal market,” the Sports Betting Alliance said in a statement to Medill News Service. The Sports Betting Alliance has pumped over $2.4 million into Alabama congressional political action committees, which do not disclose which candidates they support, according to data from Transparency USA.
“You’re looking for new markets, and Alabama is one of those places that doesn’t really have gambling, so people putting money into congressional races, gubernatorial races, other races in Alabama, they want to have a lottery,” Jarvis said. “They want to have sports gambling. They want to have all the other types of gambling that other states have.”
The Department of Government Efficiency cut over 20% of the Commodity Futures Trading Commission’s staff last year. Figures raised concerns that if Congress seeks to expand the regulatory powers of the commission, it must be equipped with the proper resources and personnel.
“As these markets continue to evolve, Congress has a possibility to ensure that CFTC has the resources, staffing and authorities necessary to protect consumers while also preserving the integrity of markets,” Figures said.
At the hearing, members of Congress argued for bipartisan efforts to bring regulatory frameworks and protections for users on prediction markets.
Republican chairman of the subcommittee Dusty Johnson, R-S.D, said he welcomes bipartisan efforts to better regulate prediction markets and sports betting across the country. He said he expects more hearings on prediction markets in the near future.
“Today's discussion will help us better understand (prediction markets) – wherein the law is working, where it may be falling short and whether Congress has more work to do,” Johnson said. “We have a terrific panel of witnesses today, and I'm certain to have no shortage of optimal discussion and likely debate; in fact, I'm kind of looking forward to that part.”
Jacques Abou-Rizk and Olivia Ardito are graduate student journalists at Northwestern Medill.
Children watch a July Fourth Parade along the Walkway of Heroes and Independence Avenue on July 04, 2026 in Tappan, New York.
The Great American Grumpfest
Our nation’s 250th birthday party didn’t feel especially patriotic and wasn’t as much fun as the 200th anniversary was.
President Trump, who did his best to co-opt our holiday for his personal aggrandizement, was a major reason. The party he threw in Washington, D.C., was crankier than uplifting, and less about celebrating our shared past and a promising future than about reminding us how far we have strayed from our founders’ plan to create a republic that future Americans would keep in good working order.
Credit Trump this much. He has a singular gift for picking at scabs that other politicians would rather ignore and pushing us into reckonings we don’t need.
The thing is, Americans have seen all this before. Sometimes the makeover we were encouraged to undertake was more conservative, sometimes more liberal. Whatever direction we were pushing, however, the reckoning we had in mind this time had to be more forthright and the conclusion more definitive than it was the last time.
Our current discontents, the ones behind the reckoning President Trump has been trying to inspire, are not trivial. Included among them are immigration, birthright citizenship, exploding healthcare costs, election rigging, a gag-inducing national debt, how we educate our children, too many genders, racial differences we can’t move past, a lopsided economy that favors more well-off Americans, and historic levels of political corruption and graft. Add to these the several foreign adventures he has pushed us into or is anxious to undertake, and you have the makings of a national headache the likes of which we haven’t had in half a century.
All the elbow-throwing and overheated rhetoric we’re using today have begun to look almost normal in all the ways that bickering neighbors and feuding family members appear normal. But they have also made us look mean-spirited and have portrayed our differences as irreconcilable. To ourselves, of course, but also to many people outside the United States who might be forgiven for turning their heads and not looking at the national car wreck we Americans show no interest in avoiding.
The good news, as I suggested above, is that Americans have had a great deal of practice dealing with challenges and national car wrecks like these.
This essay begins to lay out the reasons why.
By way of illustration, we have our seemingly insatiable demand for more bad news about race in America.
Sixty years after being released from the legal constrictions that bedeviled both white and black Americans, many white people have come to believe the color that used to make them unassailable is now a sign of a moral inferiority born of a racial animus they can never wash off. Many black people, on the other hand, are insisting that America is as hopelessly stacked against them as the formerly unassailable white people’s ancestors used to tell their black ones.
The result is that many people today are buying into racist nightmares and mumbo jumbo that their black and white ancestors worked hard and effectively to put in each other’s heads.
This might be dismissed as crazy behavior if it weren’t so important to rituals Americans have long used to express their deepest fears about each other while figuring out what move they can make that won’t end with their world crashing down on everybody’s head.
Unfortunately, the kind of cultural sleight of hand we have used to ramp up our racial differences has been appropriated by people who have many other cultural fears and unresolved differences with each other. Their clumsy but culturally prescribed missteps are making all these other issues look as irremediable as our racial problems.
A good place to start an answer to how we back away from ledges is Alexis de Tocqueville’s writing on early-19th-century American democracy. He had an optimistic take on Americans’ unscripted displays of public bravado, recrimination, and payback.
For him, these were occasions when people tried to mitigate the effects of the unfair hand they were dealing someone else or had themselves been dealt by behaving in ways quite at odds with how they would otherwise be expected to act. These inversions of what Tocqueville called “the natural order of conscience” presented themselves as a loud but culturally muted challenge to the hypocrisies that people had built into the world they’d made together.
One of his favorite illustrations of early-American hypocrisy involved slave masters sleeping with their less-than-worthy slaves. To the best of my knowledge, he didn’t pick up on all the ways that slaves messed with their owners. Their well-chronicled and quiet resistance showed that even severely ill-treated people can exercise more control over their lives than outsiders appreciate.
Be that as it may, such inversions of a people’s “natural order of conscience” make a good public show of them wrestling with demons they can’t or may not want to shake off, but in any case, are nowhere close to figuring out how to cast out.
Implicit in these disruptions was the discomforting idea that people might flip the entire script and turn the world on its head in more permanent ways. That kind of flipping worked out better for us in our revolution against England than in our Civil War. These events taught us the value of stepping back from historically unprecedented ledges.
Americans of late have been giving loud expression to a long list of things they don’t like about each other and the last makeover they started but didn’t finish a half-century ago. The outcome of our fights today will be as revealing as they are embarrassing to everyone who imagined they could recast our country in a way that privileged their favorite kind of Americans.
Their disappointment with the accommodations they strike will be palpable, but the middling results they achieve with all their pushing and shoving won’t be anything they can’t live with.
Anthropologists who have written about such moments in other cultures less “advanced” than our own show that people find ways to work around their seemingly irreconcilable differences without ever fully resolving them. Indeed, the patches and repairs people make have the unheralded effect of reinforcing rather than undermining the legitimacy of the practices and values they thought were fundamentally flawed.
For example…
White guilt and black pessimism do more good than putting cash into the pockets of professional shamers and handwringers. They give the rest of us who don’t feel guilty or powerless more time to make the world less racially unequal. Good news.
Regarding illegal immigration, the entrance requirements for future immigrants will remain stringent. Americans will applaud the continued detention and deportation of the few illegal immigrants who commit serious crimes. Good news.
All the people who came to the United States without being legally vetted and were locked up for a time will be released in numbers small enough to avoid serious media attention. Along with the several million other good people who snuck in but avoided capture, the former detainees will go to school, find gainful employment, pay their taxes, and stay out of trouble. Many will eventually become citizens. Good news.
Investigations into election tampering and Donald Trump’s 2020 presidential loss will come to an unceremonious conclusion the day after his second term ends. Many Americans will grumble about this, but there will also be some quiet partying, too. Good and bad news.
Congressional hearings into all the grifting accomplished by people tied to the Trump administration will end without anyone having to pay a dime back to the American taxpayers. Bad news, we’ll learn to live with.
New laws and regulations will be created in the hope that the kind of corruption practiced by President Trump will not be repeated for another 250 years. Good news, I hope we’ll live long enough to enjoy.
Show trials for people who allegedly vandalized the Lincoln Memorial Reflecting Pool, if they happen, will get big television viewer ratings. Good news.
Trials for pardoned Capitol insurrectionists who committed serious crimes after their release should get more attention, but won’t. Bad news.
We will continue to hear nothing from most of the people who were pardoned for crimes they committed in the insurrection at the Capitol on January 6, 2021. They will keep their mouths shut and their heads down for the rest of their life. Good news.
The gold-gilded ornaments that Donald Trump had plastered all over the White House will be shipped to Mar-a-Lago, where the former president will sell them on eBay. Fun news.
American taxpayers end up paying for most of the new East Wing, the removal of the miniature gladiatorial arena that was built behind the White House, and the restoration of the White House rose garden. Bad news.
The Triumphal Arch was never built. Good news.
Trad wives and gay couples raise perfectly lovely children. Good but unsurprising news.
Trans men and women learn that most Americans can’t figure out who they used to be. No one gives a second thought to their use of “family bathrooms” or “unisex bathrooms” in public settings, businesses, and schools. Communities will sponsor athletic teams that have trans boys and girls just to show they can. Good news.
Budget deficits will be kicked down the road for someone else’s children to pay down. Bad news.
Federal agencies that had their budgets and employee ranks slashed during President Trump’s second term are getting some of the money and lost positions back. Good news.
Elite universities will buy their way out of DEI purgatory by competing for conservative scholars whose inflated salaries dwarf those of their liberal colleagues, who will think about suing their institutions for reverse discrimination but won’t be able to figure out who would pay for it or care. More fun news.
Okay. I’ve probably missed some ways that Americans will step back from the ledges they have been making noises about leaping off. But to the extent that my predictions pan out, the best and most important moral of the stories about us stepping away is this: everything we lost and took back, or had returned to us, will have happened without our government collapsing, civic traditions crumbling, or our people beating each other up.
The reason why is that the differences Americans have with each other really weren’t as irreconcilable as we made them out to be. The empty-sounding bromide that Americans have more that unites us than divides us turns out to be true, not just metaphorically but in fact.
Now that is really something to celebrate.
Daniel J. Monti (danieljmonti.com) is Professor of Sociology at Saint Louis University and the author of American Democracy and Disconsent: Liberalism and Illiberalism in Ferguson, Charlottesville, Black Lives Matter, and the Capitol Insurrection.