Nine House Democrats have formally requested the Federal Trade Commission investigate online prediction market platforms over advertising practices that may mislead consumers. According to reports from crypto.news, the letter was led by Representatives Kevin Mullin and Gabe Vasquez, with additional signatures from Jared Huffman, Raul Ruiz, Salud Carbajal, Mike Levin, Dina Titus, Paul Tonko, and Valerie Foushee. The lawmakers specifically asked the FTC to respond by June 29 regarding whether the agency has received complaints about prediction markets and whether it plans any enforcement action.
The Democratic lawmakers highlighted what they describe as inconsistent messaging between public advertising and regulatory filings. As reported by crypto.news, some prediction market platforms use public advertisements linked to sports betting, including terms such as legal betting and betting on sports without a sportsbook. However, these same companies tell regulators they offer financial contracts. Representative Kevin Mullin stated that these prediction market companies are presenting themselves differently to regulators than they are to the public, which can mislead consumers about applicable rules and consumer protections.
Prediction markets have experienced significant growth in 2026, with transactions crossing 191 million in March and monthly trading volume reaching approximately $23.9 billion, according to crypto.news reports. Much of this growth stems from political, macroeconomic, and geopolitical event contracts, with crypto-related contracts now representing a smaller share of total activity on some platforms. The growth has intensified regulatory pressure, including Congressional examination of Kalshi and Polymarket over insider-trading concerns and federal investigations into trades linked to former U.S. Representative George Santos.
Kalshi has established the advocacy group Americans for Fair Markets, which plans to push for federal prediction market rules, consumer protections, user checks, and limits on certain event contracts, as reported by crypto.news. The FTC request comes as some regulators argue that sports and election-linked contracts look like gambling products, while platforms seek federal treatment under financial market rules. The mixed regulatory treatment has created a complex policy environment for the rapidly growing prediction market industry.
