Kalshi and Polymarket step up lobbying as US states push to regulate prediction markets

Kalshi and Polymarket are expanding their political operations as US states try to classify sports-event contracts as gambling. For high-risk operators, the practical issue is straightforward: if state rules apply, prediction markets could face licensing, local customer-protection requirements, and, in some jurisdictions, shutdowns.

1. Demand Progress says Kalshi has sharply increased its lobbying spend, reporting $1.8 million in the first half of 2026, compared with $615,000 for all of 2025. The advocacy group’s report, “Prediction Markets’ Bet on Influence”, frames that jump as part of a broader push to build political cover while the industry fights state-level enforcement.
2. Kalshi has also been hiring people with direct political and regulatory experience. The company reportedly brought in Stephanie Cutter, a former Obama administration official; John Bivona, a former Biden administration official; Tony Hanagan, a former senior Republican floor staffer; and Jed Bhuta, who worked for Democratic members of Congress.
3. Demand Progress says Polymarket has hired David Urban, a former adviser to Donald Trump’s presidential campaign. The same report says Donald Trump Jr. is reportedly involved with both Kalshi and Polymarket, which shows how aggressively the sector is trying to put names with access into the room.
4. The report also points to the Coalition for Prediction Markets, which Demand Progress describes as a lobbying front. The coalition named former Democratic Rep. Sean Patrick Maloney as president and former Republican Rep. Patrick McHenry, who led the House Financial Services Committee, as senior adviser.
5. The legal backdrop is still moving. In September, the Sixth US Circuit Court of Appeals said Ohio and Tennessee could treat sports event contracts as a type of gambling. In Nevada, the Ninth Circuit Court of Appeals reached a similar conclusion. But another ruling blocked New Jersey from regulating prediction markets, leaving the question of who gets to police these contracts unsettled.

Ella Fanger, a policy adviser for Demand Progress, argued that state and tribal gambling laws remain a key protection against predatory practices. Her point is the one market operators and their payment partners will care about: if courts keep fragmenting the rules, the cost of doing business depends less on product design and more on which state decides to test the boundaries next.