Details Emerge on Rep. Titus’ Sports Event Contract Prohibition Bill

• Language is now available for Rep. Dina Titus‘ (D-NV) Fair Markets and Sports Integrity Act
• The bill will prohibit prediction market companies from offering sports event or casino-style gaming contracts
• The bill was introduced two weeks ago, but its language debuted today

Rep. Dina Titus (D-NV) is hoping an introduced piece of legislation will successful amend the Commodity Exchange Act to prohibit transactions involving certain popular event contracts to users.

Titus’ bill, the Fair Markets and Sports Integrity Act, aims to prohibit prediction market companies from offering sporting event or casino-style gaming contracts throughout the U.S.

The sports event market contracts have become incredibly popular over the course of the last several months, but the regulation of the contracts are the subject of a number of ongoing state lawsuits.

Prohibiting Sports Event Contracts

Titus introduced HR 7477 on Feb. 10, but language debuted for the legislation this week. If approved, a “registered entity may not list for trading, facilitate, or clear any agreement, contract, or transaction that is based on, references, or derives its value from, or otherwise involves any sporting event or athletic competition; or any casino-style game.”

According to the legislation, sporting event or athletic competition contracts means “any live, simulated, or virtual event involving physical or mental skill or athletic performance in which 1 or more participants or teams compete or face a challenge and an outcome, score, or statistical measure is determined, including amateur, intercollegiate, or professional sports.”

Additionally, casino-style games are defined as “any game customarily offered in casinos or gambling establishments, including slot machines, blackjack, roulette, craps, poker, bingo, lotteries, or any digital or simulated version of such games.”

The bill currently sits in the House Committee on Agriculture.

Sports Event Contracts at Center of Lawsuits

The sports event contracts Titus hopes to prohibit are the central issue of a number of state and federal lawsuits.

Just this week, Kalshi sued Utah Gov. Spencer Cox (R) and Attorney General Derek Brown in U.S. District Court. The prediction market company said the two publicly expressed opinions that Kalshi was operating illegally under Utah’s anti-gambling laws and would likely take legal action against the company for its offerings.

Kalshi’s lawsuit against Gov. Cox and Brown – and all of its lawsuits against states gaming commissions – revolves around the central question of who regulates sports event contracts, and prediction markets.

Companies such as Robinhood, Kalshi, and Crypto.com believe that state regulatory bodies do not have the right to intrude on the government’s “exclusive” authority to regulate prediction market, filing lawsuits in New Jersey, Nevada, and Maryland to defend its practices. These companies believe the CFTC is the only regulatory body that can legally block contracts from being offered to customers.

State gaming regulators maintain the markets need to be beholden to regulations, taxes, and license fees that sports betting and gaming operators are required to follow.

The prediction market companies believe their offerings are not required to comply with state laws, as they have been preempted by the Commodity Exchange Act.