Nevada Gaming Control Board chairman Mike Dreitzer has warned that, following expansion into sports betting, online casinos will be next for prediction markets.
Prediction markets, such as Polymarket and Kalshi, have rapidly expanded their sports markets to include all major esports events. Polymarket recently cemented its presence in the sphere by signing a deal with GRID.
This is the first step of a “three-act play,” warned Dreitzer. The next step is to offer online casino-style games, followed by migrating those products into physical electronic gaming terminals resembling slot machines.
Valuations Need Higher Revenue Than Sports Betting
Kalshi announced a $1 billion Series F funding round in May 2026, valuing the company at $22 billion. Polymarket is valued at around $15 billion.
Speaking at the National Council of Legislators from Gaming States’ Summer Meeting in San Diego, Dreitzer said those valuations cannot be sustained purely from sports markets.
“They don’t get to the valuations that they have in sports betting,” Dreitzer said. “They’ve got to do more than that.”
He added that gaming manufacturers have repeatedly demonstrated an ability to convert one form of regulated wagering into electronic products that are largely indistinguishable from traditional slot machines.
“I can tell you that the people in this segment are very great at ingenuity,” Dreitzer said. “If there’s a proper loophole, they’re going to find it.”
Nevada has been the most successful state at driving out prediction markets. The state has blocked access to Polymarket, Kalshi, and Crypto.com. Additionally, FanDuel and DraftKings withdrew their applications for sports betting licenses as they expanded into prediction markets.
With a heavy reliance on revenue from the state’s licensed casinos, Nevada is keen to protect the industry from competitors.
Betr COO Experiments With Slot-Like PMs
A slot-like prediction market is possible, and Betr COO Alex Ursa has shown how it could work. Ursa posted on X a slot-like interface he built on Kalshi that used different sports markets to ‘spin’ the slot.
Kalshi responded by blocking Ursa from its platform.
“This has nothing to do with Kalshi and can be done on top of the NYSE or anything else,” Kalshi spokesperson Elisabeth Diana stated. “We also blocked him because it’s against our policies.”
Betr has partnered with Polymarket to offer prediction markets, but has not announced any plans to use Ursa’s creation on its platform.
Esports Games Provide Model For PMs
Prediction markets have already pushed the boundaries of what constitutes a financial product into all kinds of sports markets.
Sportsbooks have similarly pushed the boundaries into casino-style games, with offerings such as Historical Horse Racing (HHR) and “Games powered by Past Motor Races”, which Hard Rock Bet launched last year.
Howard Glaser, who works at slot developer Light & Wonder, said he also believes prediction markets will push into casino gaming.
The CFTC proposed new rules on prediction markets last month, including prohibiting “event contracts that settle based on purely random events, such as the spin of a roulette wheel or the outcome of a random-number generator.”
But Glaser says the HHR loophole could be used by operators.
“Important to note that the CFTC proposed rule would not prevent ‘gamification’ of non-random events – a casino or slots simulated reveal married to real time, real world information (think “forward looking HHR” – Bloomberg terminal meets slot display),” Glaser wrote on LinkedIn.
Prediction Lounges Could Be On Every Street Corner
The endgame could be prediction lounges on every street corner, particularly in states with no commercial casinos, Dreitzer warned.
“Think about a ‘prediction lounge’ right next to a church,” he said. “That’s a real possibility here.”
Polymarket opened ‘The Situation Room’ in Washington DC in March, a pop-up bar aimed at attracting prediction market users. The 3-day event does not appear to have been overly successful, suggesting Dreitzer’s concerns may be overstated.
