Prediction markets, which allow wagering on events like elections, Federal Reserve decisions, and increasingly sports and horse racing, have recently gained significant media attention, including coverage by 60 Minutes. These markets operate under the Commodity Futures Trading Commission but do not support horse racing purses or tracks, raising concerns within the racing industry. Litigation efforts, such as those by 1/ST Racing, have sought to protect the sport from unlicensed betting sites, with recent court rulings awarding damages to licensed operators under the Interstate Horseracing Act.

Beyond horse racing, prediction markets face growing legal challenges nationwide. Regulatory bodies like the Louisiana Gaming Control Board have issued advisories stating that prediction market wagering constitutes illegal sports betting under state law and could jeopardize licenses for involved parties. Numerous lawsuits, including those involving major operators like Kalshi, are ongoing, with tribal entities also contesting these markets under the Indian Gaming Regulatory Act. This mounting legal pressure suggests that licensed pari-mutuel wagering industries, including horse racing, may find strong allies in their efforts to regulate or limit prediction market activities.