California tribes are determined to advance their legislative effort to legalize online sports betting by the year 2028, despite facing growing competition from sports prediction markets. James Siva, Chairman of the California Nations Indian Gaming Association (CNIGA), reaffirmed this goal while speaking at the National Council of Legislators from Gaming States (NCLGS) Summer Meeting in San Diego on Thursday.
Siva emphasized that under the Indian Gaming Regulatory Act (IGRA) and various tribal-state compacts, California’s federally recognized tribes hold exclusive rights to Class III gaming products, including sports betting. Any establishment of a regulated online sports betting market will require voter approval and renegotiation of existing gaming compacts.
This initiative to place the online sports betting question on the ballot in November 2028 is not a new plan. Four years prior, California voters rejected sports betting proposals amid competing interests from tribal leaders and commercial sportsbooks. Siva underscored his commitment to an inclusive model for expanding gaming, assuring that no tribe would be overlooked in the process. He advocated for equitable treatment of all gaming tribes and sought to create economic opportunities for non-gaming tribes and their communities.
The stakes for the tribes have become considerably higher. Indigenous communities have long faced challenges to their gaming exclusivity, battling against threats from unlicensed sportsbooks to a recent surge in sweepstakes casinos. However, Siva asserted that the current challenge posed by sports prediction markets is unprecedented.
Several firms, including Kalshi and Polymarket, have begun to offer models akin to sports wagering in California, alongside major sportsbooks like DraftKings and FanDuel, which previously attempted to undermine tribal interests in their push to legalize online sports betting. DraftKings Predictions and FanDuel Predicts provide sports event contracts in California but block activity on federally recognized tribal lands.
"Without a doubt, prediction markets are the largest, most impending threat we’ve faced since the creation of this industry," Siva stated firmly, a sentiment echoed by Yuhaaviatam of San Manuel Nation Vice Chair Johnny Hernandez Jr., who noted that these sports event contracts qualify as gaming products.
The impact on tribal gaming revenue from these prediction markets is already becoming evident, with Siva estimating that tribes could be losing as much as 5% of their revenues to these platforms. "We're starting to see real revenue numbers leave Indian Country," he remarked.
In reaction to the rise of these markets, tribes have actively contested their legality. A notable lawsuit filed against Kalshi and its partner Robinhood was dismissed in 2022 when a judge denied the tribes' request for a preliminary injunction that would have forced Kalshi to geoblock access to their services on tribal lands in California, the largest state without legal online sports betting.
States across the country are wrestling with how to regulate prediction markets. Illinois and Kentucky have passed legislation to tax and oversee event contract revenues, while North Carolina has included provisions to tax them without offering regulatory oversight.
However, California tribes oppose any moves that might legitimize prediction markets. During a discussion at the NCLGS Summer Meeting, Pechanga Band of Indians General Counsel Steve Bodmer warned that state efforts to regulate prediction markets could imply endorsement of their operations as gambling. Siva stated bluntly that California tribes have actively lobbied against legislation intended to address prediction markets, arguing that even attempts to ban certain aspects could unintentionally validate others.
"Any bill that codifies a piece of this action just helps their argument," Siva said. He expressed that the optimal outcome for tribes would be a definitive elimination of these markets altogether. For now, California tribes will continue to focus their efforts on the goal of achieving legal online sports betting by 2028.
