Prediction Markets vs. Casinos & Sportsbooks: As Kalshi Scores $22B Valuation, Gaming Executives See 'Leading Concern'

By Bill Speros

May 7th, 2026 1:29 PM EDT

Prediction Markets vs. Casinos (via Grok)

On the same day Kalshi touted a $22 billion valuation, gaming executives reported a "positive outlook" for their industry but remain fixated on the threat posed by prediction markets to both casinos and sports betting apps.

The American Gaming Association's Gaming Industry Outlook reports that "emerging risks – particularly from prediction market platforms offering sports event contracts" continue to shape industry concerns.

The Gaming Conditions Index (GCI) grew 1.5% over the past year. That metric measures gaming revenue, employment, wages, executive sentiment, and casino hotel event activity.

“The legal state- and tribal-regulated gaming industry continues to demonstrate resilience and adaptability in a dynamic economic environment,” said AGA President and CEO Bill Miller in a release. “Operators are focused on investing in innovation and delivering world-class entertainment, while also navigating an evolving competitive and regulatory landscape.”

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Gaming Conditions Index Key Findings:

Among the highlights of the Outlook, at least from the industry's perspective:

• More than 60% of executives expect increased capital investment, higher revenues, and stronger balance sheets over the next six to 12 months.
• Executive sentiment reached its highest level since Q3 2022, with a 21.4% net positive outlook across key business indicators. 
• 62% of executives plan to increase capital investments over the next six to 12 months, while promotional activity is expected to decline for the second consecutive survey.

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Prediction Markets 'Leading Concern' For Gaming Executives

Kalshi's valuation news came via a social media update from CEO Tarek Mansour.

"Today, Kalshi represents over 90% of US prediction market volume and the majority of activity globally, with annualized volume growing to $178B over the past 6 months. What started as retail is quickly becoming institutional — hedge funds, asset managers, prop firms, and insurers are beginning to trade, provide liquidity, and hedge real-world risk directly. The scope and scale of prediction markets are just beginning to take shape," Mansour posted.

Last year at the Global Gaming Expo, Miller declared war on both dual-currency sweepstakes casinos and prediction markets. The 2026 GCI finds 81% executives' prediction markets - regulated at the federal level and designated as trading platforms - as a “very significant” risk to the regulated gaming industry.

“Illegal sports betting through sports event contracts is increasingly encroaching on legal, state-and tribal-regulated operators,” said Miller in the AGA's Wednesday release. “It’s clear the legal, regulated industry views this as a threat, and will continue to fight back and protect the integrity of our industry.”

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Prediction Markets Split Traditional Gaming Allies

That "very significant" risk isn't going anywhere. Kalshi last month scored a major legal victory when a federal appeals court ruled that New Jersey gaming regulators could not ban the platform from trading sports-related contracts in the Garden State. More than a dozen states remain involved in legal actions, either as defendants or plaintiffs, concerning prediction markets.

DraftKings, Fanatics, and FanDuel left the AGA in the past year due to its zero-tolerance stance on prediction markets. Those companies both launched prediction platforms in 2025. Bet365 also left the AGA, but said its decision was driven by its digital-first focus. It has yet to launch any prediction-based platforms.

Several bills at the state and federal levels continue to be discussed that would ban prediction market sports trades and/or implement new rules and penalties for insider trading.

The Commodities Futures Trading Commission's recent public comment period on its proposed prediction market rules drew more than 3500 comments, including responses from multiple gaming operators, sportsbooks, professional leagues, players' unions, and the prediction markets themselves.

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About the Author

Bill Speros

More About Bill

Bill is an award-winning journalist and editor whose career includes stops at USA Today Sports Network / Golfweek, Cox Media, ESPN, Orlando Sentinel and Denver Post. He's been covering the North American regulated gambling market for almost a decade and has his finger on the pulse for all industry news involving sportsbooks, online casinos, prediction markets and more. Bill placed his first bet at age 11, and his first job was as a paper boy delivering the Boston Herald and Boston Globe. By age 16, he was playing blackjack and getting comped drinks on the Las Vegas Strip. When home, his weekend rotation included trips to Wonderland Greyhound Park and Raynham Greyhound Park. After 30 years in legacy media, Bill wedded his passion for journalism and storytelling with a lifetime of wagering by working at Gambling.com.

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