The battle over prediction market regulation is entering a new phase as consumer class action litigation emerges alongside ongoing debates over government regulation of these platforms.
As discussed in Bloomberg Law, the growing number of consumer class action lawsuits being brought against prediction market operators, Polymarket and Kalshi, highlights how successful lawsuits could result in stricter guardrails around platform offerings, disclosures, and marketing practices.
Davis+Gilbert Advertising + Marketing Partner and Co-Chair Ron Urbach explains that plaintiffs are often seeking more than monetary recovery. “They’re looking for change in the business practices.” Changes on the table include new disclosures, modified advertising, revised Terms of Use, and structural changes in business operations.
As prediction markets continue their rapid growth, the intersection of consumer protection law, advertising practices, and platform operations will be an area to watch closely. Stay tuned – the future is getting even harder to predict.