US lawmakers seek FTC review of prediction market marketing and consumer messaging
Nine Democratic representatives have asked the Federal Trade Commission to examine whether prediction market operators are promoting their offerings as gambling.
US.- A group of lawmakers in the US House of Representatives has formally requested that the Federal Trade Commission (FTC) review the way prediction market platforms promote their services to consumers. They cited concerns about potential inconsistencies between public advertising and regulatory positioning.
The request was led by representatives Kevin Mullin and Gabe Vasquez, who argued that some operators may be presenting their offerings as betting products to attract users while describing them to regulators as financial markets based on investment contracts. The initiative was also supported by Jared Huffman, Raul Ruiz, Salud Carbajal, Mike Levin, Dina Titus, Paul Tonko and Valerie Foushee.
Gambling or financial markets – do prediction markets want it both ways?
In a letter, the lawmakers asked the FTC to clarify by June 29 whether it intends to pursue any investigative or enforcement measures related prediction market operators’s marketing practices.
According to the representatives, several companies in the space have adopted marketing language commonly associated with sports betting, including references to legal wagering and alternatives to traditional sportsbooks. At the same time, they have sought to distinguish themselves from gambling operators when it comes to regulatory requirements.
“These prediction market companies are presenting themselves differently to regulators than they are to the public, and that kind of contradictory messaging can mislead consumers about what rules and protections actually apply. We are urging the FTC to investigate these practices and ensure consumers are protected from this potentially deceptive activity,” Mullin stated.
The representatives also requested information on whether the agency has received complaints from consumers regarding prediction markets and whether public communications, advertising campaigns and legal filings are taken into account when assessing potential deceptive conduct.
Prediction market operators such as Kalshi and Polymarket have come under increasing scrutiny, including regarding market integrity and the handling of potential insider trading cases.
