Gaming association: States lost $1B in tax revenue to prediction markets

The American Gaming Association (AGA) now estimates that U.S. states have missed out on more than $1 billion in tax revenue because of the rise of unregulated prediction markets.

In an appearance on CNBC's "Squawk Box," AGA President and CEO Bill Miller detailed the estimate, emphasizing that the lost revenue has real consequences for communities. "It's about states and tribes that are losing literally a billion dollars today in state and tribal revenue that would otherwise go to fund important community projects," he said. The association, which advocates for casino operators, also noted that Native American casinos are affected as well.

For stock market and equities traders, this development highlights the growing tension between regulated gambling and unregulated financial betting platforms. Prediction markets, which allow users to wager on outcomes of events like elections or economic data, operate in a legal gray area, bypassing state taxes and oversight. This could lead to increased regulatory scrutiny, potentially impacting companies involved in the sector. Traders may want to monitor any legislative or regulatory actions that could affect the valuation of gaming and betting stocks. For current pricing on related equities, check NowPrice's stocks page.

Looking ahead, the AGA's estimate could spur state-level efforts to regulate or tax prediction markets more aggressively. Investors should watch for proposed legislation in key states and any responses from federal regulators. The outcome may reshape the competitive landscape between traditional casinos and online betting platforms, with implications for revenue streams and market share.