This year's G2E conference in Las Vegas, Nevada had a running them, centering around sweepstakes and prediction markets and whether these services are welcomed within regulated US gambling.
Four panelists, including gaming industry leaders and legal experts, discussed this topic at last week's show. Those speaking at this educational session Watch Legal Founder Daniel Wallach, American Gaming Association VP of Government Relations Tres York, Play'n Go Head of Government Affairs Shawn Fluharty and Light & Wonder Global Head of Government Affairs & Legislative Counsel Howard Glaser.
To date, 17 states have declared sweepstakes illegal gambling, although half of those states have taken no action against sweepstakes operators, Wallach said.
Wallach led off the session by commenting on Kalshi challenging these letters in court. The company has filed lawsuits in Ohio, Nevada, Maryland and New Jersey.
However, legal challenges over whether its products are permitted around the US are not new to Kalshi.
Kalshi's recent lawsuit against the Commodity Futures Trading Commission (CFTC) claimed the commission "wrongfully denied its application to launch a market for derivatives tied to results of congressional elections."
The suit resulted from a recent decision made by CFTC to reject Kalshi's proposal, which would have allowed some traders to place wagers for up to $100m on the outcome of elections. The proposal raised concerns regarding potential election interference.
The CFTC determined that US investors cannot directly bet on the outcome of the 2024 Congressional elections. The organization ruled that contracts "involving gaming and activity that is unlawful under state law and are contrary to the public interest."
Wallach said he has "been obsessed" with the researching the current trends surrounds sweepstakes and predictions market, while questioning their legality.
This topic was also not new to York either.
"This issue was brought to us by our membership," he said when asked if the AGA had been approached. "This was not an entirely new thing."
Glaser weighed in on what has made sweepstakes what they are today and said people are looking for ways to play casinos online in states that do not have access to legal iGaming.
He compared the demand for this to 1920s Prohibition in the US and said the industry is divided and many brick-and-mortar establishments fall on both sides of the debate.
Glaser said this issue needs to be addressed regardless of where people in the industry land on the topic and cited recent legislation against sweepstakes in California as a preview of things to come
"This issue is over," he said.
Fluharty agreed and noted the use of offshore websites in the US has put sweepstakes products on the regulatory radar. According to Fluharty, 50% of ads people see for online gaming come from offshore companies.
"It's waking up legislators across the country to take a stand," he said. "You're seeing it across the country."
He added that Play'n Go is not getting involved in offering sweepstakes to its players.
More than 100 cease-and-desist letters have been sent out to sweepstakes companies, including Kalshi
