A lobbying battle between prediction market companies and the casino and gaming industry is accelerating in Washington, with both sides sharply increasing their spending on Capitol Hill in 2026.
Kalshi, the largest U.S.-regulated prediction market, spent $990,000 on lobbying during the first half of the year, according to CNBC, which reviewed federal filings released this week. When including outside firms the company has hired, its total reaches nearly $1.8 million. That exceeds the full $1 million Kalshi spent on lobbying for all of 2025 and marks the company's highest six-month total on record.
Kalshi's chief rival, Polymarket, has a smaller footprint on Capitol Hill. A firm lobbying on Polymarket's behalf spent $180,000 in the first half of 2026, putting it on pace to match the $360,000 spent in all of 2025. Polymarket uses one outside firm, while Kalshi employs seven, including an in-house operation.
The casino and gaming industry, which views prediction markets as a competitive threat, is also ramping up its efforts. The American Gaming Association spent $1.39 million on lobbying so far in 2026, pacing ahead of 2025. Including outside firms, the group has spent nearly $1.8 million on federal lobbying, a figure 30% higher than what it spent in the first half of last year. Cherokee Nation, which operates casinos and other gaming interests, spent $600,000 in the first half of 2026, also running ahead of its 2025 pace.
Prediction markets have drawn sustained political controversy since the start of the year. A series of trades made ahead of U.S. military actions in Venezuela and Iran raised concerns about insider trading on the platforms. More recently, a teleprompter operator for President Donald Trump was suspended after it was disclosed he was under investigation for using material, nonpublic information to place trades on Kalshi. The Wall Street Journal also reported last week about betting that may have been based on inside political information.
Both Kalshi and Polymarket say they have taken steps to address insider trading on their platforms. But lawmakers have expressed concern not only about those specific incidents but about the broader category of bets the platforms allow, including wagers on sports, elections, and government actions.
Kalshi has moved aggressively to build political relationships. The company has hired former Biden and Obama administration officials for its government relations work and counts Donald Trump Jr. as a paid advisor. CEO Tarek Mansour recently appeared at the Capitol alongside Democratic Rep. Josh Gottheimer of New Jersey in support of legislation aimed at protecting minors from online gambling.
Despite those moves, prediction market companies acknowledge the challenge ahead. Patrick McHenry, a former Republican congressman now serving as a senior advisor to the industry group Coalition for Prediction Markets, has noted that the casino and gambling industry holds a significant head start in relationships with lawmakers on Capitol Hill.
The outcome of the lobbying contest could determine whether prediction markets operate with broad federal sanction or face new restrictions in the years ahead.
