MGM CEO warns mishandling prediction markets could spur federal gambling intervention

MGM Resorts International Chief Executive Bill Hornbuckle cautioned that failure to properly address the rise of prediction markets could open the door to U.S. federal regulation of gambling, challenging a framework that has largely remained under state control since the repeal of a federal betting ban.

“If we don’t handle this correctly, it’s going to be the cement that’s being poured for the federal government to enter the space,” Hornbuckle said on the sidelines of the East Coast Gaming Congress in Atlantic City on Tuesday, as reported by iGB.

Hornbuckle’s comments come as prediction markets, such as Kalshi, face increasing scrutiny from state regulators. Kalshi, which is federally regulated by the U.S. Commodity Futures Trading Commission (CFTC), reported $86 million in trading volume during The Masters tournament—three times the volume seen during the Super Bowl.

Several U.S. states, including Nevada and New Jersey, have issued cease-and-desist orders against Kalshi and similar operators, claiming they offer illegal sports betting. Kalshi has filed lawsuits in response, arguing that the states “fundamentally misunderstand” how federally regulated prediction markets function. A U.S. district court recently granted Kalshi a preliminary injunction against the Nevada Gaming Control Board, halting enforcement actions for now.

Hornbuckle emphasized that gambling regulation should remain a states’ rights matter, citing the Tenth Amendment and the U.S. Supreme Court decision that struck down the Professional and Amateur Sports Protection Act (PASPA), allowing states to legalize sports betting.

“It has always been, it needs to be and continues to be a states’ rights issue,” he said.

American Gaming Association (AGA) President Bill Miller echoed Hornbuckle’s concerns, warning that prediction markets threaten responsible gambling standards and may conflict with federal statutes, including the Wire Act and the Indian Gaming Regulatory Act.

“It’s hard for me to see this as anything other than a threat,” Miller said. He added that the markets “undermine” and “upend” decades of state regulation and, in some cases, contravene state constitutions.

Miller also raised concerns that federal oversight of prediction markets could preempt tribal-state gaming agreements, which have long governed the operations of tribal casinos. 

Speaking at the conference, Seminole Gaming CEO Jim Allen said it was too early to take a definitive stance but emphasized the need for oversight. “Clearly we have to have an environment where there is investigation, where there is licensing,” he said.

The CFTC is set to hold a roundtable on April 30 to explore the future of sports event contracts. A participant list has not yet been released.