Former Trump Official Mick Mulvaney Launches Campaign to Reclassify Prediction Markets as Gambling

In a move that’s sending shockwaves through both the tech and political worlds, former Trump administration official Mick Mulvaney has launched a new advocacy coalition called “Gambling Is Not Investing,” aimed at reclassifying prediction markets under state gambling laws rather than federal derivatives regulations.

Mulvaney, who served as President Trump’s acting White House chief of staff from 2019 to 2020, brings a unique perspective to the debate. As a former member of Congress representing South Carolina, he’s not just another Washington insider—he’s the only former congressman who’s actually won a poker tournament in Las Vegas. “You’re talking to the only former member of Congress who’s won a poker tournament in Las Vegas,” he told WIRED, establishing his gambling credentials upfront.

The former official’s position is clear and unapologetic: prediction markets that offer contracts on sporting events are essentially sports betting in disguise. “You know the old saying, if it walks like a duck and quacks like a duck, it’s a duck?” Mulvaney asks rhetorically. “If it looks like a sports bet, if it sounds like a sports bet, if it pays off like a sports bet, if it’s on a sporting event—it’s a sports bet.”

This stance puts Mulvaney at odds with the current federal approach, which classifies these platforms as derivatives markets overseen by the Commodity Futures Trading Commission (CFTC). Traditional sportsbooks allow customers to bet on which team will win or lose a game, while prediction markets offer “event contracts” on outcomes. Critics like Mulvaney argue this distinction is merely a regulatory loophole that needs closing.

The timing of Mulvaney’s new coalition is particularly significant given the fierce political battle currently raging over prediction market regulation. Earlier this month, former New Jersey Governor Chris Christie and current Utah Governor Spencer Cox both spoke out against the current federal approach, with Christie employing the same “quack like a duck” metaphor that Mulvaney favors.

State authorities across the country are already pursuing lawsuits against prediction market companies like Kalshi, alleging they violate state gambling laws. While these markets offer event contracts on a wide variety of topics, sporting events remain their most popular offerings, which strengthens the argument for gambling classification.

Mulvaney’s coalition, Gambling Is Not Investing, has attracted an impressive roster of founding member organizations, including several conservative consumer advocacy groups. Among them are Moms for America, Consumer Action for a Strong Economy, and Frontiers of Freedom—groups that bring both grassroots credibility and political muscle to the effort.

The debate has reached a fever pitch at the federal level as well. A group of 23 Democratic Senators recently sent the CFTC a letter urging it to allow state court cases to play out without federal interference. The response from CFTC head Michael Selig was swift and defiant. Selig insists that prediction markets are correctly classified as derivatives and that his agency has proper jurisdiction over the industry.

In an unprecedented move, the CFTC even filed a brief in support of cryptocurrency platform Crypto.com, which faces a lawsuit from Nevada regulators over its prediction market offering. This aggressive stance represents a dramatic shift from the Biden administration’s approach, which included fining Polymarket $1.4 million for failing to register as a derivatives market and temporarily blocking it from operating in the US.

The current regulatory environment appears to dovetail with White House interests in the prediction market industry. The Trump family has numerous ties to this sector. Truth Social, the social media platform majority-owned by President Trump and his family, is planning its own prediction market offering reportedly called “Truth Predict.” Donald Trump Jr. serves as an advisor to both Kalshi and Polymarket, and his venture capital firm has invested in Polymarket.

Despite these connections, Mulvaney remains optimistic about making his case to the current administration. “Their default position is going to be to regulate less, not more. And I respect that,” he acknowledges. “But I also know that in the first Trump administration, when there were common sense reasons to do some regulation, that we did that.”

Mulvaney’s position highlights an important schism within the Republican Party regarding prediction markets. While some Trump allies see these platforms as innovative financial instruments worthy of minimal regulation, others like Mulvaney view them as gambling operations that require the same oversight as traditional sportsbooks.

The outcome of this debate could have significant implications for the rapidly growing prediction market industry, which has seen explosive growth in recent years. These platforms have become increasingly popular among both retail investors and political enthusiasts, particularly during election cycles when users can bet on everything from presidential election outcomes to congressional seat flips.

As state lawsuits proceed and federal regulators dig in their heels, Mulvaney’s new coalition represents a formidable challenge to the status quo. With his unique combination of gambling experience, political connections, and conservative credibility, he may be exactly the right person to lead this fight at a time when prediction markets stand at the intersection of finance, technology, and politics.

The battle over how to classify and regulate these platforms is far from over, but with Gambling Is Not Investing now in the fray, the debate has entered a new and potentially decisive phase. Whether prediction markets will ultimately be treated as innovative financial instruments or simply another form of gambling may depend largely on whether Mulvaney and his coalition can convince both state authorities and the federal government to see these platforms through the same lens they view traditional sports betting operations.

Tags: Mick Mulvaney, prediction markets, gambling regulation, CFTC, sports betting, Trump administration, Polymarket, Kalshi, Truth Social, political betting, derivatives markets, state gambling laws, conservative advocacy, Moms for America, consumer protection, regulatory oversight, event contracts, sports contracts, Michael Selig, Chris Christie, Spencer Cox, Donald Trump Jr, cryptocurrency regulation, federal vs state jurisdiction, financial innovation, gambling industry, political markets

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