U.S. Prediction Markets Face New Regulatory Scrutiny Over Addiction Risks

Prediction markets have surged in the United States, with combined trading volume rising from $5 billion in September 2025 to $24 billion by April 2026, driven largely by sports betting. Health officials and doctors warn that the rapid growth is fueling a gambling addiction epidemic, especially among teens. The Texas Medical Association urged tighter consumer protections, proposing age‑21 limits, bans on advertising near schools and parks, and restrictions on celebrity endorsements.

In response, lawmakers are moving to curb the industry. The U.S. Senate voted unanimously to bar its members from trading on prediction markets, and the bipartisan GAME Act, introduced by Sen. Richard Blumenthal and Sen. Katie Britt, seeks to prohibit gambling advertisements targeting minors. The Commodity Futures Trading Commission also proposed a rule banning prediction‑market contracts tied to wars, terrorist attacks and assassinations. These actions reflect mounting concern that prediction‑market platforms, while not classified as traditional gambling, pose similar psychological risks and may contribute to a rising tide of addiction.