Democratic lawmakers push to tighten prediction market rules in digital asset bills to protect tribal gaming rights
2026-07-21
Source: Focus Gaming News
Twelve Democratic senators are pushing for amendments to the CLARITY Act and DCIA to prevent unregulated prediction markets from undermining tribal gaming sovereignty. They propose a savings clause for tribal compacts and a ban on CFTC-registered entities listing sports-bet-like contracts.
Twelve Democratic senators have urged US congressional committees to amend two digital asset bills, arguing that the current language could enable unregulated prediction markets that undercut tribal gaming exclusivity and state oversight. In a joint letter to the Senate Banking and Agriculture committees, the lawmakers focused on the Digital Asset Market Clarity Act (CLARITY Act) and the Digital Commodity Intermediaries Act (DCIA). They contended that, as written, these bills would benefit decentralized finance betting protocols that offer sports wagering and casino-style contracts, thereby sidestepping state gambling laws and the Indian Gaming Regulatory Act (IGRA) of 1988.
The senators warned that the unchecked expansion of such prediction markets threatens the revenue streams of tribal nations – funds that support public services including healthcare, education, housing, and public safety. The Commodity Futures Trading Commission currently classifies sports and event contracts as financial derivatives, a treatment the senators said allows operators to avoid state and tribal regulatory frameworks. To address these concerns, the letter calls for two specific changes: first, a savings clause that explicitly preserves the existing tribal–state gaming compact system and IGRA’s protections; and second, a prohibition on CFTC-registered entities from listing contracts that mimic sports bets or casino games, with limited exceptions for certain decentralized finance platforms.
Signatories to the letter include senators Tina Smith (Minnesota), Maria Cantwell and Patty Murray (Washington), Richard Blumenthal (Connecticut), Mark Kelly (Arizona), Tammy Baldwin (Wisconsin), Alex Padilla and Adam Schiff (California), Jacky Rosen (Nevada), Brian Schatz (Hawaii), and Gary Peters (Michigan), joined by Senator Martin Heinrich. The National Congress of American Indians, the Indian Gaming Association, and 17 tribal governments in New Mexico – among them the Mescalero Apache Tribe and several pueblos including Santa Ana, Sandia, Isleta, Laguna, Acoma, Taos, and Pojoaque – have publicly endorsed the senators’ appeal.