Kalshi Backs Lobby Group to Defend Prediction Markets

Kalshi, the U.S.-based CFTC-regulated prediction market platform valued at $22 billion, has thrown its weight behind a new lobbying initiative. The group, dubbed Americans for Fair Markets, aims to advocate for federally regulated prediction markets and push back against what it calls misinformation spread by casino and sportsbook lobbyists. Former White House deputy chief of staff Taylor Budowich has signed on as a strategic advisor.

The timing is no coincidence. On the same day Americans for Fair Markets launched, the U.S. House announced a probe into Kalshi and its competitor Polymarket over insider trading concerns. Meanwhile, regulatory disputes between the Commodity Futures Trading Commission (CFTC) and state authorities have escalated. States have accused prediction platforms of violating gambling laws, while the CFTC asserts its exclusive jurisdiction over these markets.

In a statement, Kalshi accused entrenched interests like casinos of trying to protect their monopolies by spreading “false narratives” about prediction markets. Americans for Fair Markets plans to run paid campaigns to combat these claims and advocate for consumer protections, including know-your-customer (KYC) requirements, insider trading bans, and restrictions on markets linked to violence or terrorism.

Kalshi’s Market Position

Kalshi’s support for the lobbying group underscores its growing influence. Founded in 2018 by MIT alumni Tarek Mansour and Luana Lopes Lara, Kalshi became the first federally regulated event contract exchange in 2020 after receiving Designated Contract Market (DCM) status from the CFTC. Initially focused on political markets, Kalshi has since expanded into macroeconomic indicators, IPO outcomes, and sports, which now account for over 90% of its trading volume.

Despite its rapid growth—doubling its valuation to $22 billion with a $1 billion Series F funding round announced earlier this month—Kalshi faces significant regulatory hurdles. For example, a federal judge in April temporarily barred Arizona from prosecuting Kalshi under state gambling laws, reaffirming the CFTC’s authority. However, this ruling has not settled the broader jurisdictional dispute, which remains a contentious issue for prediction platforms nationwide.

Strategic Implications

The creation of Americans for Fair Markets signals a shift in strategy for Kalshi, which is now taking a more aggressive stance in shaping federal policy. The group’s formation follows the December 2025 launch of the Coalition for Prediction Markets, another advocacy effort backed by Coinbase, Crypto.com, and Robinhood. Together, these initiatives highlight the industry’s push to legitimize prediction markets as financial tools rather than gambling platforms.

Kalshi’s lobbying effort also comes amid mixed signals from policymakers. Former President Donald Trump recently criticized prediction markets over allegations of well-timed bets related to geopolitical events, only to soften his stance days later, warning that the U.S. risks falling behind if it stifles the sector. Trump’s son, Donald Trump Jr., is an advisor to both Polymarket and Kalshi, adding a layer of complexity to the political dynamics.

What’s Next

Americans for Fair Markets plans to focus its efforts on aligning with the CFTC’s regulatory framework while addressing state-level challenges. The group’s ability to counter well-funded opposition from casinos and sportsbooks will likely influence how prediction markets evolve in the U.S. As regulatory debates intensify, traders and investors in the space should keep a close eye on developments both in Congress and at the CFTC.

With its deep pockets and growing political clout, Kalshi appears determined to secure a more stable regulatory environment. Whether these efforts succeed could have significant implications for the future of prediction markets as an asset class.

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