On Wednesday, the Nevada Gaming Control Board (NGCB) became the latest state regulator to warn licensees about potential disciplinary measures related to offering sports event contracts on prediction markets. This follows similar notices this year in Ohio and Michigan.
In a notice issued on Wednesday afternoon, the board said that offering contracts on sports, elections or pop culture events constitutes “wagering activity” under state law. This is regardless of whether the contracts are listed on an exchange under the Commodity Futures Trading Commission or not, the board said. The CFTC is the federal financial regulator that oversees prediction markets.
Licensees that offer these contracts or strike similar partnerships in Nevada, another state or on tribal lands could now face suitability evaluations or further discipline.
“Examples of event contracts that the board specifically considers to be wagering subject to its jurisdiction include event contracts based on the outcome or partial outcome of any sporting or athletic event, or other selected events such as the World Series of Poker, the Oscars, esports and political elections,” the release stated.
“Offerings for sports and other events contracts may be conducted in Nevada only if the offering entity possesses a nonrestricted gaming license with sports pool approval in Nevada and meets the other requirements for sports wagering including, without limitation, wagering accounts and sports book systems.”
Warning echoes comments at latest Nevada hearing
The notice piggybacks on comments made by NGCB member George Assad at the board’s most recent hearing 8 October. Assad railed against prediction markets, calling them “nothing more than a word salad”. He celebrated recent court rulings against platforms Kalshi and Crypto.com in Maryland and Nevada, respectively.
“A derivative contract or whatever you want to call it is nothing more than a sports wager,” Assad said. “A sports wager is a sports wager. Every bet made in this town is a contract.
“You can call it a derivative contract or a credit default swap like they did during the housing bubble. Whatever you call it, it’s still a sports bet.
“Therefore, it’s under the jurisdiction of the Nevada Gaming Commission and Nevada Gaming Control Board.”
Nevada has fought a multi-front legal battle with prediction markets in 2025. The state was the first to send a cease-and-desist letter to Kalshi in March. Kalshi sued in response and won a preliminary injunction in April to continue operating for the time being. That case is currently under appeal.
Cease-and-desists were also sent to Crypto.com and Robinhood, and both sued in response as Kalshi did. Crytpo.com filed suit in June and Robinhood filed in August.
Notably, as Assad alluded to, Crypto.com saw its injunction request denied this month by Judge Andrew Gordon, the same judge who previously ruled in favour of Kalshi. The two suits were largely the same in terms of context but the specific legal arguments varied slightly.
Gordon found Kalshi likely to succeed on its claim that federal commodities law preempted state wagering law, but was unconvinced in the Crypto.com case about its definitions of “swaps” and whether they apply to sports event contracts. The Robinhood case has yet to see a ruling.
Fostering innovation while ensuring compliance
Prediction markets were top-of-mind last week at the Global Gaming Expo in Las Vegas. NGCB Chair Mike Dreitzer appeared on a regulatory panel to discuss several pressing issues, including anti-money laundering concerns in state casinos and prediction markets. Dreitzer took his post in June and is the fifth NGCB chair in the last six years.
While he noted that “Nevada’s stance on prediction markets is well known”, his stance seemed more open than Assad’s regarding the burgeoning technology. The NGCB’s cease-and-desist letter against Kalshi was issued by his predecessor, Kirk Hendrick.
“We want to foster innovation, we want to find a way to bring it to Nevada as early as possible, but it has to be done in conjunction with the legal requirements,” Dreitzer said. “That’s just one example of many where we’re happy to have ’em here, but let’s figure out a way to get it in under our roof.”
Dreitzer said he wants to instil the message that Nevada is “open for business” when it comes to innovation and new technology. His tone was more nuanced than other senior regulators who have spoken about prediction markets. That includes Mike Leara, executive director of the Missouri Gaming Commission, who sat next to Dreitzer and decried the platforms in the same conversation.
But for Dreitzer specifically, the message is consistent with his career in gaming. Prior to joining the NGCB, he held senior roles at tech-focused companies like BMM Testlabs, Gaming Arts and Ainsworth Game Technology.
Which companies inquired about prediction markets?
The NGCB said in its release that it had received “direct inquiries” from licensees about its prediction market stance. Notably, FanDuel and DraftKings, the two largest commercial bookmakers in the US, do not operate in Nevada largely because of its in-person account registration requirement.
Some sports betting and DFS companies expressed interest in the sector or inked partnerships. Examples include FanDuel’s CME Group deal and Underdog’s partnership with Crypto.com.
Others, like Caesars Sportsbook and BetMGM, have refrained from substantial investments. The two platforms are the largest sports betting operators live in the state. Neither company responded to a request for comment, although neither has publicly endorsed or signalled interest in prediction markets.
The state’s biggest retail casino operators are vocal opponents of prediction markets, led by casino trade group Nevada Resort Association, which was approved as an intervenor in the state’s appeal against Kalshi. NRA President Virginia Valentine told iGB at the Global Gaming Expo that the platforms are simply “gambling with no regulation” or consumer protections.
“There are no requirements for responsible gambling, they don’t pay any state income tax. So it looks a lot like gambling, and we’ll see,” Valentine said. “Is it the future of gambling or is it the end of sportsbooks? I don’t know, but we’re going to be watching that very closely. I imagine that this will be in the courts for a while, so we’re just keeping a close eye on it.”
In the midst of multiple court battles, Nevada regulators issued a fresh warning about prediction markets.