The Nevada Gaming Control Board has issued a stern warning to gaming operators, indicating that their licenses could be jeopardized if they engage with companies that offer prediction market contracts. This message came from Board Chairman Mike Dreitzer in a detailed notice titled “Sports Event Contracts are Wagers,” highlighting the regulatory stance on prediction markets, including entities like KalshiEx LLC, Crypto.com, and Robinhood.
This warning marks the second time in recent days that regulators have cautioned operators on this matter. During the Control Board’s meeting on October 8, board member George Assad praised a recent court decision against Crypto.com, stating that prediction markets are now under scrutiny and that their operations may be coming to an end.
The tension escalated when Kalshi filed a lawsuit in March against the Nevada Gaming Control Board. This lawsuit followed a cease-and-desist order issued by the board, which directed Kalshi to halt the offering of contracts that mimic sports wagers within Nevada. That case remains unresolved and is anticipated to be heard in the U.S. District Court in Nevada later this year.
As states across the nation grapple with the rise of prediction markets, many have started to challenge these platforms. Proponents of prediction markets assert that they are permitted to operate nationwide since they are regulated by the federal Commodity Futures Trading Commission. However, states argue that gambling activities should fall under their jurisdiction.
Dreitzer’s notice emphasizes that gaming licensees who collaborate with event prediction markets might face repercussions from state regulators, regardless of where the operations occur—whether within another state or on tribal lands. The notice stipulates that any offerings related to sports contracts must be conducted only by entities possessing a nonrestricted gaming license with sports pool approval in Nevada, along with compliance to other sports wagering requirements.
The notice clarifies that contracts based on the outcomes of sporting events, as well as other selected events—such as the World Series of Poker, the Oscars, Esports competitions, and political elections—are prohibited.
Furthermore, citing Nevada Revised Statutes and gaming regulations, it warns that if a Nevada licensee engages in offering these contracts or partners with entities involved in such activities, the board will closely evaluate these actions when determining the entity’s eligibility to retain a Nevada gaming license.
The implications of this notice also extend to applicants seeking licensing for new ventures, as they too will be assessed under this interpretation, adding another layer of caution for those looking to enter the Nevada gaming market.
