Nevada Gaming Management Board chairman Mike Dreitzer has warned that, following growth into sports activities betting, on-line casinos will likely be subsequent for prediction markets.
Prediction markets, comparable to Polymarket and Kalshi, have quickly expanded their sports activities markets to incorporate all main esports occasions. Polymarket lately cemented its presence within the sphere by signing a take care of GRID.
This is step one of a “three-act play,” warned Dreitzer. The following step is to supply on-line casino-style video games, adopted by migrating these merchandise into bodily digital gaming terminals resembling slot machines.
Valuations Want Increased Income Than Sports activities Betting
Kalshi introduced a $1 billion Sequence F funding spherical in Could 2026, valuing the corporate at $22 billion. Polymarket is valued at round $15 billion.
Talking on the Nationwide Council of Legislators from Gaming States’ Summer time Assembly in San Diego, Dreitzer mentioned these valuations can’t be sustained purely from sports activities markets.
“They don’t get to the valuations that they’ve in sports activities betting,” Dreitzer mentioned. “They’ve acquired to do greater than that.”
He added that gaming producers have repeatedly demonstrated a capability to transform one type of regulated wagering into digital merchandise which might be largely indistinguishable from conventional slot machines.
“I can let you know that the individuals on this phase are very nice at ingenuity,” Dreitzer mentioned. “If there’s a correct loophole, they’re going to seek out it.”
Nevada has been essentially the most profitable state at driving out prediction markets. The state has blocked entry to Polymarket, Kalshi, and Crypto.com. Moreover, FanDuel and DraftKings withdrew their functions for sports activities betting licenses as they expanded into prediction markets.
With a heavy reliance on income from the state’s licensed casinos, Nevada is eager to guard the business from rivals.
Betr COO Experiments With Slot-Like PMs
A slot-like prediction market is feasible, and Betr COO Alex Ursa has proven the way it might work. Ursa posted on X a slot-like interface he constructed on Kalshi that used completely different sports activities markets to ‘spin’ the slot.
Kalshi responded by blocking Ursa from its platform.
“This has nothing to do with Kalshi and will be completed on high of the NYSE or the rest,” Kalshi spokesperson Elisabeth Diana said. “We additionally blocked him as a result of it’s towards our insurance policies.”
Betr has partnered with Polymarket to supply prediction markets, however has not introduced any plans to make use of Ursa’s creation on its platform.
Esports Video games Present Mannequin For PMs
Prediction markets have already pushed the boundaries of what constitutes a monetary product into all types of sports activities markets.
Sportsbooks have equally pushed the boundaries into casino-style video games, with choices comparable to Historic Horse Racing (HHR) and “Video games powered by Previous Motor Races”, which Exhausting Rock Guess launched final yr.
Howard Glaser, who works at slot developer Mild & Surprise, mentioned he additionally believes prediction markets will push into on line casino gaming.
The CFTC proposed new guidelines on prediction markets final month, together with prohibiting “occasion contracts that settle based mostly on purely random occasions, such because the spin of a roulette wheel or the end result of a random-number generator.”
However Glaser says the HHR loophole could possibly be utilized by operators.
“Essential to notice that the CFTC proposed rule wouldn’t forestall ‘gamification’ of non-random occasions – a on line casino or slots simulated reveal married to actual time, actual world info (suppose “ahead wanting HHR” – Bloomberg terminal meets slot show),” Glaser wrote on LinkedIn.
Prediction Lounges May Be On Each Avenue Nook
The endgame could possibly be prediction lounges on each road nook, significantly in states with no industrial casinos, Dreitzer warned.
“Take into consideration a ‘prediction lounge’ proper subsequent to a church,” he mentioned. “That’s an actual risk right here.”
Polymarket opened ‘The Scenario Room’ in Washington DC in March, a pop-up bar aimed toward attracting prediction market customers. The three-day occasion doesn’t seem to have been overly profitable, suggesting Dreitzer’s considerations could also be overstated.
