TLDR
- Five Democratic lawmakers sent a letter to 12 CEOs of sportsbooks and prediction markets over concerns about targeting young adults aged 18-24
- Kalshi was called out for a TikTok ad where a user claimed to earn two years’ rent from trading on the platform
- An Ipsos poll found young men aged 18-24 are twice as likely as others to use sports betting or prediction market apps
- The lawmakers labeled industry efforts to address concerns as “insufficient” and “reactive” and requested answers to 12 questions by May 29
- The SAFE Bet Act, which would impose federal regulations on sports betting advertising and bonuses, has not received a committee hearing
Five Democratic lawmakers in Congress sent a letter on Monday to 12 CEOs of online sportsbooks and prediction markets. The letter raised concerns about how these platforms are affecting young adults in America.
The lawmakers include U.S. Reps. Valerie Foushee, Paul Tonko, Betty McCollum, Kevin Mullin, and U.S. Sen. Richard Blumenthal. They accused the platforms of using predatory advertising to reach Americans aged 18 to 24.
“We are particularly alarmed by the rapid normalization of online gambling among younger Americans and the targeting of this demographic through predatory advertising,” the letter stated.
The group singled out Kalshi, a prediction market platform, for a specific TikTok ad. In the ad, a user claimed to have earned enough money to cover two years of rent by trading on the platform.
Prediction Markets Draw Fire Alongside Sportsbooks
The lawmakers also pointed to Kalshi’s partnerships with major news outlets including CNN, CNBC, Dow Jones, and Yahoo Finance. They argued these partnerships create an environment where Gen Z is more likely to fall into a culture where “everything is gambling.”
Sports betting platforms were also targeted. The letter criticized bet365’s “Winning is Everything” campaign for ramping up advertising as competition grows.
The lawmakers cited an Ipsos poll from roughly two months ago. That poll found that young men aged 18-24 are twice as likely as any other group to use a daily fantasy, prediction market, or sports betting app.
“These trends point towards a broader shift towards normalizing a new, unregulated form of betting for the next generation,” the letter said.
All 12 operators that received the letter are currently regulated. Some operate under state-level sports betting rules, while others are regulated at the federal level as prediction markets.
Several states have taken prediction markets to court, seeking to block them from offering sports contracts. Lawmakers at both state and federal levels have filed bills to either ban prediction markets from sporting events or require them to follow state sports betting rules.
The five lawmakers acknowledged that some operators have taken steps to address these concerns. But they called those steps “insufficient” and “reactive.”
Lawmakers Want Answers by May 29
Besides bet365 and Kalshi, the letter was sent to CEOs from Polymarket, Caesars, BetMGM, DraftKings, FanDuel, Robinhood, Fanatics, and PrizePicks.
The lawmakers asked the operators to answer 12 questions by May 29. They also requested a briefing on the issue of targeting young adults.
This letter is the latest move by Congress to push sportsbooks and prediction markets toward changes. Last year, Tonko and Blumenthal filed the SAFE Bet Act. The bill would ban sportsbook advertising during live sporting events and prohibit promoting bonuses or incentives.
The SAFE Bet Act would also require affordability checks on customers who wager $1,000 or more in a day or $10,000 or more over 30 days. It would bar prop betting markets on college and amateur athletes.
Blumenthal also filed a separate bill that would direct a portion of the federal sports betting excise tax toward grants for states to fund problem gambling programs. None of these bills has advanced to receive a committee hearing.
Next week, U.S. Sen. Marsha Blackburn will hold a hearing on sports betting integrity. American Gaming Association President and CEO Bill Miller and IC360 Co-Founder and CEO Scott Sandin are scheduled to testify.
