Tribal prediction markets: Is the reputational pendulum swinging the other way?

Warren Buffett once said “it takes 20 years to build a reputation and five minutes to ruin it.” In the case of prediction market operator Kalshi, it appears two decades might be too long to wait.  

Since developing the company in 2018, Co-Founders Tarek Mansour and Luana Lopes Lara have seemingly cared more for expansion than reputation. Kalshi has grown to reach valuations of over $20bn, all while garnering scrutiny for its lack of attention to regulators both on the state and Tribal level.  

Mansour and Lopes would most likely point to becoming the first prediction market operator to gain regulatory approval from the Commodity Futures Trading Commission (CFTC), but the platform remains engaged in legal battles to this day. On September 18, however, Kalshi took a major step toward potentially turning the reputational tide in its favor, agreeing to a new partnership with the Tunica-Biloxi Tribe of Louisiana.  

For the first time in gaming history, the two parties will develop a Tribal prediction market, following the issuance of a no-action letter from the Commodity Futures Trading Commission (CFTC) to authorize participation. 

After months of throwing haymakers back and forth, the first sign of compromise was pushed forward by the Tribe – described as "exactly the type of opportunity Indian Country should be pursuing” by Tunica-Biloxi Chairman Marshall Pierite. While the collaboration could signal future growth for Tribal prediction markets, early reactions have stifled any excitement.  

How has Indian gaming responded to Kalshi’s Tribal partnership? 

Less than a week after the Tunica-Biloxi Tribe’s partnership with Kalshi was unveiled, Indian Gaming Association (IGA) Chairman David Bean released a statement regarding the collaboration, as well as how Indian gaming plans to respond.  

“Attempting to hide behind a Tribal Nation and pushing them forward as an example of innovation only exposes Commissioner Selig’s cynical aims to protect a clearly illegal betting platform. His timing could not be worse as they lose court case after court case and the prediction market industry is embroiled in cover ups over the actual size of its customer base and how much of their handle is just bots placing the same bets continuously,” Chairman Bean said.  

“There is nothing in the CFTC’s work around for Tribes that benefits Tribal economies, it will only benefit prediction markets and allow unregulated sports betting to flourish. Kalshi… will use your customer lists and Tribal sovereignty to simply add more money to their CEOs pocket books. This fight is far from finished, but together, Tribal Nations will see this battle to its successful end.”  

Chairman Bean’s retort comes as no surprise given IGA’s repeated attempts to regulate prediction markets and belief that the vertical serves as the most notable threat to Tribal sovereignty.  

IGA is also coming off a recent victory after watching the Clarity Act fail to pass through the US Senate, which Chairman Bean had spent much of the past two months leading the charge against from Washington DC. Lopes and Mansour could argue their latest deal represents less of a retaliation and more so an olive branch to how prediction markets and Tribal gaming can work in unity.  

Figures such as Chairman Bean and IGA Conference Chair Victor Rocha appear hesitant to agree with the claims, as Rocha exclusively shared with Global Gaming Insider that “we wish them the best of luck, but it doesn’t stop our fight against prediction markets. 

“I hope they got paid in advance.” 

Having also confirmed plans to “neuter” Kalshi rather than follow a similar path as the Louisiana Tribe, Rocha may speak for the majority of Indian country – but the few who choose to break ranks could mark a new era for the vertical.  

What type of potential do Tribal prediction markets hold? 

Given the National Indian Gaming Commission (NIGC) recently unveiled that Tribal gaming once again set a new record in fiscal year revenue – $46.2bn – it’s fair to picture the vast potential prediction markets could carry within the industry. According to Mansour, the “debate” between protecting Tribal sovereignty and prediction markets’ growth came to an end with his most recent partnership, offering a resolution where both sides come out victorious.  

"The debate can no longer be reduced to prediction markets on one side and Tribes on the other. What's clear is that regulated national infrastructure and Tribal entrepreneurship can develop together — and one does not have to lose for the other to win,” Mansour said.  

While convincing Chairman Bean and Rocha stands as a more long-term project, building success with the Tunica-Biloxi Tribe will only shrink the line separating both sides. Despite the pushback IGA may believe is coming, economic self-determination remains as the most crucial goal for Tribes across the US. If Kalshi’s partnership with the Louisiana Tribe proves fruitful, it wouldn’t be a shock to see other reservations follow suit.  

Global Gaming Insider previously covered rising costs for Tribes and the threat of prediction markets with Wipfli Partner Grant Eve, who touches on how Tribal organizations can respond to increasing outside pressures.  

One notable element of the partnership is also the no-action letter from the CFTC, which could allow Tribes to maintain greater independence over not only the type of prediction markets offered to users, but the capabilities each respective platform can provide. Even in the event of Tribes preferring to not bring sports event contracts into their communities until nationwide regulation is formed, it’s difficult to imagine such concerns being a dealbreaker for operators.  

At the end of the day, the more Tribes who cross the metaphorical line into enemy territory, the less hostile it may appear. No matter the pace in which prediction markets become integrated with Tribal gaming, the resulting pay-off is obvious to those who have paid any attention to Tribal gaming since the Covid-19 pandemic.  

With multi-billion-dollar trading volumes being generated each month, as well as the record figures produced by Tribal gaming every fiscal year, finding common ground between the two sides may represent the most substantial union gaming has ever seen.  

Should FanDuel, DraftKings follow suit? 

Not to be forgotten in this unfinished tale is whether familiar faces such as FanDuel and DraftKings may look to copy Kalshi’s method in the near term. It’s quite obvious the two operators have still yet to catch the prediction market giant – or perhaps even those currently battling for podium placement – but working with Tribes could be the opportunity which allows for a more competitive race.  

For Tribes which have already integrated a form of sports betting within their reservations, partnering with a FanDuel or DraftKings would be far more familiar than a Kalshi or Polymarket. Not only that, it certainly helps that the language Chairman Bean and Rocha would use to describe the two sports betting operators would be more… positive to say the least. 

As discussed previously, those who remain hesitant to offer sports event contracts could still provide a form of sports betting by working with a FanDuel or DraftKings, which may not be possible with a prediction market-based entity. While iGaming has also yet to properly find its place among Tribal reservations, the all-in-one approach sports betting and online gambling operators could bring to Tribes may represent the leg-up FanDuel and DraftKings need.  

It’s not as if such operators have skirted negative headlines, though, exemplified by recent reports of DraftKings using AI-powered data analysis to target gamblers most likely to place a losing bet. According to former employees of the operator, DraftKings specifically targeted losing gamblers with promotional incentives such as free bets, while efforts to identify problem gamblers were stalled or dropped entirely.  

So, what really separates the likes of FanDuel and DraftKings from Kalshi or Polymarket? If headlines are to be believed, nothing really – but both would still advertise a better reputational standing than their prediction market counterparts.  

With the Global Gaming Expo (G2E) slowly approaching as well, it will be interesting to hear if leadership from either operator plans to discuss such opportunities at the conference. Tribal gaming figures such as Chairman Bean and Rocha will certainly be in attendance also, creating a familiar main event-type atmosphere in North America’s gambling capital.  

With Kalshi’s inaugural partnership garnering reaction across the industry, how Indian gaming responds will be the most notable discussion point to close out 2026.