The Indian Gaming Association is opposing the Digital Asset Market Clarity Act, arguing that the legislation would expand the authority of the Commodity Futures Trading Commission (CFTC) while federal and tribal gaming interests are challenging the regulation of prediction markets.
The position puts the group against a bill designed to establish a framework for cryptocurrencies, digital assets and decentralized finance (DeFi) applications. Sen. Cynthia Lummis (R-WY), chair of the Senate Banking Electronic Assets Subcommittee and a longtime supporter of cryptocurrency regulation, sponsored the legislation.
CFTC authority at the centre of dispute
The bill would allow the CFTC to oversee certain crypto transactions and includes a carve-out for DeFi platforms. The Indian Gaming Association objects to that provision because it believes the resulting increase in CFTC authority could affect tribal gaming and state gambling laws.
Prediction markets are currently regulated by the CFTC. State gaming regulators argue that they should instead fall under state oversight, while tribal gaming interests say the markets infringe on state gambling compacts. The group also argues that prediction market platforms compete for gamblers in major markets, including California.
Indian Gaming Association Chair David Z. Bean said the bill fails to limit the commission’s role.
“The bill does nothing to rein in the CFTC. Instead, the CLARITY Act represents the largest expansion of CFTC authority since the 2010 Dodd-Frank bill. This expansion comes at a time when the CFTC is blatantly violating tribal and state laws, its own regulations, and the clear intent of Congress by allowing gaming to occur on platforms such as Kalshi and Polymarket,” Bean said.
Lummis has said the legislation primarily legalizes additional crypto trading activities and does not change the existing position of prediction markets.
Perpetual futures and tribal sovereignty
The bill would also effectively legalize perpetual futures markets, known as “perps” among crypto traders. These products allow traders to bet on whether an asset’s price will rise or fall without owning the underlying asset, rather than holding the asset itself.
Some in the industry argue that the contracts would not be structured as products enabling users to trade sports event contracts. However, the issue has intensified opposition from tribal gaming groups to both prediction market expansion and broader CFTC authority.
Bean said the Indian Gaming Association would continue opposing the legislation unless it is amended to protect state and tribal gaming laws, as well as the Indian Gaming Regulatory Act, from being preempted by federal commodities law. He also called for provisions preventing DCMs from listing contracts tied to sports betting or casino games.
“Indian County will continue to urge members to vote against the CLARITY Act and view its enactment as the greatest threat to tribal sovereignty in a generation,” Bean said.
Connecticut is among the states challenging federal oversight of prediction markets. The Mohegan Tribe, which owns and operates one of the state’s largest casinos, supports the state’s crackdown.
