AI-rewritten: This is a summary of an article from Ars Technica, rewritten by AI (Qwen, running locally) to make it easier to read. The facts come from the original article – read it for the full story.

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In July 2010, Senator Blanche Lincoln warned that prediction markets could evade gambling laws by offering "event contracts" for sports events like the Super Bowl. She stated these contracts would serve no commercial purpose and be used solely for gambling. At the time, she was a primary author of Title VII of the Dodd-Frank Act, which gave the Commodity Futures Trading Commission (CFTC) authority to ban such trading in the public interest.

Today, Lincoln is a lobbyist for Kalshi, a firm she founded that received $480,000 since 2024 to lobby for looser regulation. While her 2010 comments supported a ban on sports betting via prediction markets, the Trump administration has used Dodd-Frank authority to allow these contracts nationwide. This has led to court battles in about 20 states regarding whether federal law preempts state gambling bans.

Kalshi launched sports betting on January 23, 2025, three days after Trump’s second inauguration. The firm argues it is regulated by federal law rather than state laws. Ilya Beylin, a business-law professor, noted that the Biden-era CFTC considered sports event contracts prohibited under Rule 40.11, but the Trump administration stopped enforcing this rule.