Indian Gaming Conference Becomes Rallying Cry To Stamp Out Sweeps, Rail Against Prediction Markets

PRIOR LAKE, Minn. — Victor Rocha was in his element Wednesday.

He talked about the epiphany he had nearly a year ago that Indian Country is under siege. In a passionate voice, he told a room full of tribal leaders, “Like Mike Tyson said, ‘Everyone has a plan until they get punched in the face.'”

Rocha’s punched-in-the-face moment came on a drive through the Mojave Desert in October 2024 as he was returning home from the Global Gaming Expo (G2E) in Las Vegas. It was then, amid the barren landscape, that he said he knew he’d been lied to by a sweepstakes operator, and that sweepstakes were a threat Indian Country could not ignore.

Two months later, another threat materialized when then little-known Kalshi got the go-ahead to offer event contracts on the presidential election. By January, Kalshi was offering sports event contracts that, like sweepstakes, are available throughout the U.S. Sweepstakes platforms are unregulated throughout the U.S., while Kalshi is regulated by the federal government, not states. Both states and tribes say prediction markets are operating with less stringent guardrails than traditional sportsbooks.

Since then, prediction markets have proliferated with PredictIt launching in the U.S. earlier this week, Polymarket poised to go live, and multiple traditional sports betting operators announcing prediction plans of their own.

While sweepstakes platforms are unregulated and Kalshi answers to the Commodity Futures Trading Commission (CFTC), Rocha and tribal leaders say the companies are breaking the law. Tribal nations across the U.S. are sovereign and some, including California’s tribes, have gained exclusivity for gaming.

In conjunction with tribal-state compacts, the federal Indian Gaming Regulatory Act gives Indian Country gaming exclusivity on reservations. That, in theory, means no gambling can happen on tribal land without tribal approval. Sweepstakes, prediction markets, and daily fantasy sports do not have such approval in most cases.

“This became an arbitrage moment,” said Rocha at the Indian Gaming Association (IGA) Mid-Year Conference. “Their goal is to build a database and when the switch gets flipped [for legal betting] in Minnesota [or anywhere else], they are going to have that database and steal all of your customers.”

Rocha: You should be scared

Wednesday’s three-part discussion addressed how black and gray markets are draining tribal resources and ways that Indian Country can fight back. Rocha, the conference chair, moderated panels with deeply experienced tribal lawyers, a representative from the American Gaming Association (AGA), IGA Chairman Ernie Stevens, and IGA Executive Director Jason Giles. He told the audience he meant to scare them, and attorney Scott Crowell echoed Rocha’s stance.

Among the goals, Rocha said, was to get Minnesota tribes riled up and ready to fight as the state legislature there again tries to legalize sports betting in 2026. After California, which has more than 100 tribes, Oklahoma and Minnesota are the biggest tribal gaming states without some form of sports betting. Tribal casinos dot all three states.

Crowell is on the team of lawyers representing California’s tribes in their case against card rooms, and he had a hand in drafting the Tribal Amici brief filed in support of the state of New Jersey in its case against Kalshi. He’s genuinely worried about the future of tribal gaming.

“My concern is that when the dust settles, if Kalshi wins, then [state-licensed sportsbooks] will just switch over to prediction markets,” Crowell said.

Kalshi on Wednesday may have moved one step closer to clearing a pathway to transacting sports event contracts across the U.S. The company is in court with three states over its ability to offer its product alongside state-regulated sports betting. The takeaway from oral arguments in the Third Circuit is that the three-judge panel was leaning into Kalshi’s arguments versus those from the state of New Jersey’s.

The case originated in district court where Judge Edward S. Kiel granted Kalshi’s motion for a preliminary injunction, allowing it to continue operating in the state. From there, the state of New Jersey appealed to the Third Circuit.

Joe Webster, a well-respected tribal lawyer who was part of the team that wrote the New Jersey amicus brief signed by 60-plus tribal entities, was monitoring the oral arguments. He announced during the already heated discussion that “We have our work cut out for us. The questions were more skeptical of the state of N.J. than of Kalshi. It’s really hard to say that I’m confident that they are going to reverse the lower court.”

California is key

Prediction markets aside, most of the legal wagering industry is aligned in the belief that unregulated sweepstakes should be shut down. Companies like Chumba, Fliff, and VGW are operating without any external guardrails and are not paying taxes to states or the federal government.

The California legislature appears poised to pass a bill that will ban sweepstakes operators. AB 831 passed the California Senate Monday, and Thursday the Assembly’s Governmental Organization Committee moved it to the Assembly floor. The session ends Friday, but the expectation is the bill will get a vote, and then get sent to Gov. Gavin Newsom’s desk.

In 2025, lawmakers in Connecticut, Montana, Nevada, and New Jersey have banned sweepstakes. And sweepstakes giant VGW in August pulled out of Canada, though it called that a strategic decision that would allow it to focus more resources in the U.S.

A new law would come on the heels of California Attorney General Rob Bonta issuing an opinion that daily fantasy sports are illegal in the state. If AB 831 becomes law and Bonta moves forward with enforcing his opinion, sweepstakes operators and daily fantasy operators like PrizePicks and Underdog would have to shutter inside state lines. PrizePicks and Underdog already made moves ostensibly to mollify Bonta, pivoting from pick’em-style games to peer-to-peer.

Bonta’s opinion is not law, thought he did write that he considers all fantasy sports to be illegal in the state. There has been no enforcement action as yet.

Underdog, licensed for legal sports betting in North Carolina and in the application process in Missouri, has done what Crowell predicted. Last week, it became the first state-licensed sportsbook to begin offering sports event wagering via a prediction market partnership with Crypto.com, focusing at the outset on 16 states that have not yet adopted legal sports betting.

Taken together, a new sweeps ban and Bonta’s opinion would represent a big victory for California’s tribes, which have yet to legalize digital sports betting. They still also view prediction markets as illegal when offered on their land. The combination would also be a massive blow to the unregulated operators, which have been under fire from state regulators for months. Regulators from Louisiana to Michigan to Pennsylvania have regularly been sending cease-and-desist letters to sweepstakes operators and offshore gambling platforms.

“If California falls, it will be huge,” AGA head of government affairs Tres York said. “It will be about one-fifth of the sweeps market in the U.S. It will be really, really rough.”

York has been instrumental in creating partnerships so the legal gambling industry can be unified in its battles against sweepstakes and prediction markets. So far, 50 attorneys general have sent a letter to the Department of Justice calling for a crackdown on offshore operators, West Virginia’s attorney general in February subpoenaed sweepstakes operators, the Louisiana Dept. of Revenue last week sued two sweepstakes platforms, and the Los Angeles city attorney in August filed suit against Stake.com, arguing it is an “illegal online gambling enterprise.”

Time to play hardball

Rocha pushed for more education but also more action from tribes against unregulated platforms. Crowell suggested that tribes play hardball when compacting with states, suggesting as an example, “Maybe say, ‘OK, so you are going to take some of our money, you need to have a dedicated person in the AG’s office that goes after illegal gambling.'”

Such a tactic could be put into play in some gaming states, including Minnesota, where lawmakers in 2026 will again consider a legal online betting bill under which tribes will be operators and will pay taxes to the state. When tribes in California run a digital wagering initiative, it could include an opportunity for them to negotiate some additional protection from the state. Oklahoma’s tribes have backed off pursuing legal sports betting until Gov. Kevin Stitt term limits out in 2026.

Attorney Michael Hoenig, also part of the Tribal Amici brief team, is the vice president of the associate general counsel for gaming for the Yuhaaviatam of San Manuel Nation, one of the richest gaming tribes in California. He suggested more indirect ways to hurt illegal operators. He pointed to Louisiana officials suing for back taxes and suggested that regulators penalize payment processors or other suppliers for working with the unregulated market.

“If you kill the whole infrastructure, then hopefully that will help so there won’t have to be as much enforcement,” he said.

Rocha, unsurprisingly, was more dramatic.

“The walls are crumbling, and eventually the venture capitalists will see that, and the money will dry up,” he said. “You’re going to see that the people you are doing business with are trying to cut your throat in the middle of the night.”