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A senior US lawmaker has called for Washington to take a more active role in policing the booming sports betting market, warning that a patchwork of state rules is failing to keep pace with rapid growth in gambling and new betting formats.
Speaking to The Hill, Senator Richard Blumenthal said Congress can no longer stand back while legal wagering expands and scandals continue to hit major leagues.
“Congress should be involved in putting some limits on sports betting, no question,” Blumenthal said. “There are two consequences from the exploding level of activity we’ve seen: corruption and addiction. The prevalence of corruption shows the guardrails are not working.”
His comments come as prediction markets and micro-betting products blur the line between regulated gambling, financial trading, and entertainment – often reaching audiences in states that have never authorised traditional sportsbooks.
State-led model under strain
Since the US Supreme Court struck down the federal PASPA ban in 2018, responsibility for regulating sports betting has rested with the states and tribal regulators. Thirty-nine states and Washington, DC now have some form of legal sports wagering, each with its own rules on licensing, advertising, bet types, and consumer protection.
Leagues and operators argue that this decentralised model works. State regulators monitor betting patterns, set limits, and investigate suspicious activity, while leagues share integrity data and restrict certain markets, such as bets on individual errors or disciplinary decisions.
Blumenthal and allies are believed to see growing gaps. They point to recent integrity cases in Major League Baseball and the NBA, in which players admitted breaking league gambling rules or altering their performance to benefit bettors. They also highlight surveys suggesting public trust has taken a hit: a Quinnipiac poll cited by lawmakers found that roughly one-third of NBA fans believe players or coaches might be involved in illegal betting.
For supporters of federal intervention, those numbers show that state rules and league policies are not enough on their own.
New worry: the prediction markets and event contracts boom
At the same time, prediction markets have moved from niche curiosity to national talking point. Platforms such as Kalshi and others offer “yes/no” contracts on real-world events, including elections, economic data, and sports-related topics. They operate under federal derivatives rules overseen by the Commodity Futures Trading Commission (CFTC), rather than state gambling law.
In testimony to the US House Committee on Agriculture this month, the NFL warned that sports-linked event contracts are now available in all 50 states, even where conventional sportsbooks remain illegal. The league said it is “particularly troubled” by contracts that allow users to stake money on sports outcomes or even on whether phrases like “concussion protocol” or “roughing the passer” are mentioned during a broadcast.
“These contracts fall outside the purview of state regulatory authorities and the safeguards they impose upon the industry,” Jeff Miller, the NFL’s executive vice president for communications, public affairs, and policy, wrote in his submission. He urged Congress and the CFTC to prohibit certain bet types and introduce “consumer and integrity protective measures” before any broader legalisation of sports-based event contracts.
The Coalition for Prediction Markets, which represents several leading operators, has pushed back, arguing that CFTC rules already ban abusive trading and that prediction markets are monitored as tightly as securities exchanges. But for Blumenthal and other critics, the rise of national-reach products that look and feel like betting strengthens the case for federal guardrails.
Addiction risks back in focus
Blumenthal and fellow Democrat Senator Cory Booker have also homed in on the public health side of the boom, especially for young adults.
Booker has called for tighter limits on proposition bets and ultra-short-term markets that let customers wager on almost every moment of a game. He has warned that constant prompts and in-play micro-bets are “design features” that can push vulnerable people into harmful patterns unless regulators step in with stricter national rules.
Their concerns echo findings from academics and treatment providers who report rising calls from younger problem gamblers, many of whom were drawn in through mobile apps and social media advertising rather than traditional casinos.
What federal action could look like
Blumenthal has not yet unveiled a detailed bill, but past proposals in Congress give a sense of what might be on the table. Earlier efforts floated ideas such as minimum national standards for age verification, advertising, and responsible-gambling tools, layered on top of state rules. Also, a federal registry of approved wagers and bet types, developed in consultation with leagues and regulators, and clearer boundaries between financial derivatives and sports betting, to decide when an event contract should fall under CFTC oversight and when it should be treated as gambling.
Supporters say a baseline framework would still allow states to choose whether to offer sports betting. It would, however, set common rules for any product that lets users stake money on the outcome of a game, player performance, or related in-play events.
Blumenthal’s comment adds to a growing chorus in Washington
Sports leagues are taking arms and warning about prediction markets. State regulators, in places like Nevada, Illinois, Louisiana, and Washington, have also issued opinions that some event contracts constitute illegal sports betting under their laws.
At the same time, big sportsbook brands such as DraftKings, FanDuel, and Fanatics are building their own prediction-style products, betting that demand for trading-like experiences will keep rising.
That tension – between innovation and oversight, state autonomy and federal standards – is unlikely to fade. As Blumenthal put it, the question before Congress is no longer whether sports betting is here to stay, but “whether we will finally put real limits in place before the damage becomes irreversible.”
Source: The Hill
