Share 
Smarkets CEO Jason Trost is calling for prediction markets to face customer-protection obligations similar to those imposed on betting operators.
Sports contracts from Kalshi and others remain at the center of a dispute over federal financial regulation and state gambling laws.
Courts across the country have given split decisions on whether sports prediction markets should be regulated at the state level like sports betting. Former Commodity Futures Trading Commission general counsel Daniel Davis told Benzinga that the dispute has a “very good chance” of reaching the Supreme Court.
Trost Argues for Similar Betting and Trading Safeguards
Trost, who has spent nearly two decades running a British betting exchange, told Benzinga that the dividing line between gambling and investing is not clear-cut.
“The debate always centers around is it gambling or is it investing? And my argument is it’s both,” he said.
He also said: “I don’t think sports betting is any more addictive than any other form of financial trading.”
That comparison is Trost’s view, not an established finding that the two activities carry equal addiction risks. A 2025 review in Frontiers in Psychiatry examined 23 papers on problematic trading and cautioned against automatically classifying trading as gambling disorder.
Trost’s proposed response is similar regulation for betting and financial trading. He suggested brokers should assess whether customers can afford the risks they take or might be addicted to trading.
Customer Protection Remains Part of the Regulatory Debate
The discussion extends beyond which regulator has authority over sports contracts to whether that regulator can address gambling-related harm.
University of Washington researcher Uttara Ananthakrishnan told Benzinga that financial regulators must be equipped to address gambling addiction and questioned whether the CFTC has the necessary expertise.
“If the CFTC is not equipped to do that, then what’s the point of regulating it?” she said.
More from gamingtoday.com
– Sixth Circuit Ruling Could Make Kalshi Pull Sports Predictions From More States
– Ohio Bill Would End Online Sports Betting, Prop and Parlay Bets, Live Wagering
– Ohio State University Study Reveals Religious Affiliation Doesn’t Prevent Sports Betting
—
Source: As reported by Benzinga.
