Nevada gaming regulators delivered their strongest rebuke yet against prediction market operators this week, as the battle over sports event contracts intensifies. At Wednesday’s Nevada Gaming Control Board meeting in Carson City, Chairman Mike Dreitzer declared that prediction markets operating in Nevada without gaming licenses are engaged in illegal gambling, regardless of how they label their products.

‘These sports prediction contracts are indistinguishable from sports bets,’ Dreitzer said. ‘As the 9th Circuit court said, placing sports bets even when called by another name is still gambling. The simple fact is anytime you risk money on the uncertain outcome of a sporting event, that’s a bet. End of story.’

The remarks followed a favorable August 28 ruling from the 9th Circuit Court of Appeals, which upheld Nevada’s authority to regulate sports prediction contracts. Board members George Assad and Chandeni Sendall joined Dreitzer in praising the decision, which they said validated the state’s regulatory framework.

However, Kalshi co-founder and COO Luana Lopes Lara pushed back in an exclusive interview, insisting the company’s business model is financial market trading, not gambling. ‘It just doesn’t work with our model and it’s not what Kalshi is about,’ Lara said. ‘A federal exchange, like financial exchanges, have always been regulated federally.’

The dispute is now heading to the US Supreme Court. New Jersey Attorney General Jennifer Davenport filed a petition for a writ of certiorari asking the justices to resolve conflicts between appellate courts on whether states can prevent prediction markets from operating within their jurisdictions. Davenport’s office noted that litigation has erupted across at least 20 states, with dozens of active suits pending.

Dreitzer raised concerns about underage participation, citing a CNN report that 18-to-20-year-olds have made $4 billion in prediction market sports trades since January. Lara countered that Kalshi uses identity verification, Social Security checks, and AI-powered surveillance to block minors from trading.

For Nevada’s gaming industry, the outcome carries significant implications. Licensed sportsbooks pay substantial taxes and fees to operate in the state, while prediction markets like Kalshi currently operate without state-level taxation or oversight. Gaming analysts do not expect the Supreme Court to weigh in until late this year or next year.

Source: Las Vegas Review-Journal