Sen. Heinrich Leads Fight to Protect Tribal Gaming Rights

U.S. Senator Martin Heinrich (D-N.M.) voted against advancing the Digital Asset Market Clarity Act, saying the legislation does not adequately protect state regulatory authority or Tribal gaming rights from prediction markets offering online sports betting and casino-style gaming.

Heinrich said he plans to introduce an amendment to the legislation that would strengthen protections for the Indian Gaming Regulatory Act (IGRA), Tribal-state gaming compacts, and state gaming laws.

“The legislation we voted on today undermines Tribal sovereignty and states’ police powers. And it directly threatens Tribes’ gaming revenues, which would mean less government services funding across Indian Country. That’s a lose-lose,” Heinrich said.

“Giving prediction markets a free pass to sidestep existing law and Tribal sovereignty is wrong, in every conceivable way. That is not to say I oppose digital asset market structure legislation. But what that legislation absolutely must include is commonsense protections for state and Tribal gaming rights, including an Indian Gaming Regulatory Act and Tribal-state compact savings clause and a ban on prediction contracts that function like sports bets or casino games.”

Proposed protections for Tribal gaming

Heinrich’s planned amendment would include two key provisions:

• An Indian Gaming Regulatory Act and Tribal-state compacts savings clause to ensure the legislation does not override existing federal protections or agreements governing Tribal gaming.
• A prohibition on Commodity Futures Trading Commission (CFTC)-registered entities listing prediction contracts that resemble sports wagers or casino-style gaming products.

The debate comes as prediction markets have expanded their offerings of sports event contracts and other products that can function similarly to traditional gambling.

Heinrich argues that the growth of these markets could threaten Tribal gaming revenues and, by extension, funding for essential government services provided by Tribal nations, including health care, public safety, education, housing, and social services.

Under IGRA, enacted in 1988, gaming on Tribal lands operates within a federal framework that recognizes Tribal sovereignty while establishing responsibilities for Tribal, state, and federal governments. Following the U.S. Supreme Court’s 2018 decision in Murphy v. National Collegiate Athletic Association, Tribes also entered the legal sports betting market through agreements and compacts with states.

Prediction markets, meanwhile, have sought to offer sports-related contracts nationwide by characterizing them as financial products rather than gambling. The CFTC has asserted jurisdiction over prediction contracts and has treated them as financial derivatives.

Heinrich contends that without explicit protections in federal legislation, prediction markets could compete with Tribal gaming while operating outside the regulatory structures established by IGRA, Tribal-state compacts, and state gaming laws.

“Without clear protections for Tribal and state gaming rights, prediction markets could compete directly with Tribal gaming while avoiding the laws and agreements designed to protect Tribal sovereignty,” Heinrich said. “Congress should ensure that digital asset market structure legislation does not create a federal pathway for companies to circumvent IGRA, Tribal-state gaming compacts, or state gaming laws.”

Heinrich also backs stablecoin amendment

Heinrich also cosponsored a separate amendment to the CLARITY Act that would prohibit stablecoin companies from offering rewards or interest in ways similar to banks.

The amendment is led by U.S. Senators Jerry Moran (R-Kan.) and Jack Reed (D-R.I.). Supporters argue that allowing stablecoin companies to offer such incentives could put pressure on local banks, potentially reducing funds available for lending to families and small businesses. It could also increase the amount of money held in stablecoin accounts that are not insured by the Federal Deposit Insurance Corporation.

July letter urged federal action

Heinrich’s opposition to advancing the CLARITY Act follows a July letter he led urging leaders of the Senate Committees on Banking, Housing, and Urban Affairs, and Agriculture, Nutrition, and Forestry, to address prediction markets offering nationwide sports and event wagering.

The letter was supported by the Indian Gaming Association and the National Congress of American Indians, as well as Santa Ana Pueblo, Sandia Pueblo, Ohkay Owingeh Pueblo, Laguna Pueblo, San Felipe Pueblo, Kewa Pueblo, Cochiti Pueblo, Acoma Pueblo, Jemez Pueblo, Santa Clara Pueblo, Taos Pueblo, Tesuque Pueblo, Zia Pueblo, Isleta Pueblo, Pojoaque Pueblo, and the Mescalero Apache Tribe.

Heinrich has said his concerns are focused on ensuring that federal digital asset legislation does not undermine the existing legal framework governing Tribal and state gaming.

Read Heinrich’s July letter