AGA Says States Have Lost $1B in Revenue to Prediction Markets, Kalshi Fires Back

The American Gaming Association this week claimed that states and tribes have missed out on as much as $1 billion in gaming tax revenue because of prediction markets.

Read more Magic hire Sean Sweeney: Meet Spurs associate HC getting Orlando job after working with Victor Wembanyama

In an email sent Thursday with the subject line “ALERT: $1 billion in lost gaming tax revenue,” AGA President and CEO Bill Miller pointed to the issue during an appearance on CNBC’s Squawk Box. 

He noted that 41 attorneys general had weighed in, stressing that while the CFTC regulates financial markets, it is not the overseer of sportsbooks. Miller said the lost revenue would otherwise fund schools, infrastructure, and community projects.

“It’s not about the AGA or the gaming industry, it’s about states and tribes that are losing literally $1 billion in state and tribal revenue that would otherwise go to fund important community projects and pay taxes to these states,” Miller added.

The statement came just days after President Trump weighed in on the debate over federal jurisdiction, saying his administration was setting “rules of the road” for states. He declared clearly that the Commodity Futures Trading Commission must retain sole authority over prediction markets and argued that the platforms should be allowed to expand without interference from state regulators.

Kashi calls $1B claims ‘fake math’

While the AGA continues to argue that prediction market platforms are offering illegal sports betting nationwide, bypassing state and tribal rules, and costing states $1 billion in tax revenue, Kalshi is not having it.

Read more Novak Djokovic stunned in French Open by Joao Fonseca to follow Jannik Sinner out of disintegrated bracket

The company rejected both the argument and the numbers. Spokesperson Elisabeth Diana told RotoWire that the $1 billion figure is “fake math from casinos, who are worried about losing their monopoly power.” 

She pointed out that the U.S. gaming industry reached a record $78.7 billion in revenue last year, questioning how such losses could be squared with that growth. 

Diana went further, saying prediction markets attract users because they are seen as fairer and safer than traditional casinos. “This is an industry that preys on people who lose. Of course they’re ok spreading lies,” she said.

Rhode Island recently filed suit against Kalshi, accusing the platform of running illegal betting operations, while Kalshi itself moved first by suing the state in defense of its business model. The CFTC has also stepped in, suing the state of Rhode Island to halt a local crackdown on prediction markets.

In Minnesota, lawmakers approved a ban on prediction markets earlier this month, and the measure now awaits the governor’s signature. The financial regulator has also stepped in with a federal lawsuit to block Minnesota’s new law as fights over prediction markets continue to escalate worldwide.

Read more Vinnie Volt: Devil Wilds Slot Review