Tribal gaming leaders are advocating for U.S. senators to modify the CLARITY Act, aiming to limit sports and casino-style prediction markets while ensuring the legislation does not supersede existing gaming laws.
The Indian Gaming Association (IGA) reported that tribal representatives engaged with senators and congressional staff during their Summer Legislative Summit in Washington, D.C. This meeting coincides with lawmakers working on the final details of a cryptocurrency market-structure bill.
IGA is pursuing two key amendments. The first would prevent federally regulated prediction markets from offering contracts based on sports or casino-like outcomes. The second amendment would clarify that the proposed legislation does not override the Indian Gaming Regulatory Act (IGRA) or any other tribal, state, and federal gaming regulations.
David Bean, Chairman of IGA, emphasized the unity among Indian Country, stating, “This is one of the greatest threats tribal government gaming has faced in a generation.”
The CLARITY Act aims to create a federal regulatory framework for digital assets, dividing oversight responsibilities between the Securities and Exchange Commission and the Commodity Futures Trading Commission.
While the act is not specifically a gaming bill, IGA contends that it could bolster claims by cryptocurrency-based prediction markets, allowing them to offer gambling-like products nationwide without adhering to tribal or state gaming laws.
The association warned that the bill, if passed without additional safeguards, “could unintentionally permit cryptocurrency-based prediction markets to proliferate online gambling across the country.”
Contracts related to sports events have become a significant point of contention among prediction market operators, state regulators, and tribal gaming stakeholders. Tribes argue that these products essentially constitute sports wagering and pose a threat to gaming rights established under federal law and tribal-state agreements.
Bean stated, “By relying on the fiction that sports bets are ‘swaps,’ the prediction markets undermine tribal sovereignty, violate the government-to-government agreements tribes have established with their states, and threaten the revenues our tribal nations rely on for healthcare, education, housing, public safety, language preservation, and essential government services.”
Additionally, tribes are contesting sports event contracts in federal court. Recently, three tribes from California requested the Ninth Circuit to prevent Kalshi from offering these contracts on their lands, asserting that federal commodities regulation does not displace IGRA or tribal authority over gaming. Similar legal challenges are ongoing in Wisconsin and New Mexico.
IGA's legislative initiative began earlier this year when it collaborated with the American Gaming Association to urge Congress to block sports betting and casino gambling from being included as event contracts in the pending cryptocurrency legislation. This effort gained momentum in February with a congressional briefing that brought together tribal leaders, the National Congress of American Indians, commercial gaming representatives, and consumer advocates.
Senate negotiators are currently working to merge separate market-structure proposals from the Banking and Agriculture committees. Outstanding issues include ethical restrictions for elected officials with cryptocurrency interests, protections for decentralized finance developers, and limitations on stablecoin rewards.
Supporters are pushing for Senate action before the summer state work period commences on August 10, but the bill still faces challenges in securing the 60 votes required to overcome a filibuster.