Kalshi’s SelfExclude Launch Beckons a New Era for Gambling Controls in the U.S.
Prediction markets aren't technically gambling products, but they can be just as addictive.
Kalshi has partnered with compliance firm IC360 to launch SelfExclude, a voluntary, cross-platform self-exclusion list for prediction market users.
This is the first time a prediction market platform has adopted such technology, normally associated with gambling products rather than financial ones.
Mass self-exclusion programs are a mainstay of more mature gambling markets. For instance, the United Kingdom has a national program called GAMSTOP. However, the state-by-state patchwork of U.S. regulation means American users of sportsbooks and online casinos don’t have access to such a wide-reaching self-exclusion list.
Many states offer regional self-exclusion, while individual operators may exclude a player nationwide. Yet there is often nothing stopping a player who has self-excluded from one platform in one state from registering with a different operator in a different state.
That offers prediction markets a chance to show off one of the benefits of federal rather than state regulation. Polymarket, Robinhood, and PredictX are all reportedly planning to follow Kalshi’s lead and adopt SelfExclude.
A Flawed System
The traditional iGaming and sports betting world handles self-exclusion on a state-by-state basis. If a problem gambler in New Jersey wants to exclude themselves from online casino play, they must register with the New Jersey Division of Gaming Enforcement’s statewide exclusion list.
That system covers all licensed operators in the state. However, if the same person crosses the border to Pennsylvania, they must start from scratch and repeat the registration process with the Pennsylvania Gaming Control Board, because the exclusion doesn’t automatically carry over.
Operators and regulators maintain key interstate compacts and voluntary operator-level programs. DraftKings and FanDuel offer their own internal self-exclusion tools, but no federal authority has created a unified exclusion database for sports betting or iGaming in the U.S. As a result, the current system allows a determined problem gambler with minimal friction to move to another state or download a different app to continue betting.
Responsible gambling advocates have repeatedly made the case for federal centralization. A single national list, overseen by a single authority with clear enforcement power, would close the gaps left by the state-by-state system. Countries like the UK have already shown that nationwide exclusion is technically possible and meaningfully effective.
There have been attempts made to build “national” programs in the U.S., but these have only seen adoption in certain states.
Prediction Markets and the CFTC Problem
The prediction market story becomes more complicated because the CFTC regulates these platforms instead of gambling regulators. This regulatory structure forms the legal foundation of the industry and underpins ongoing court battles in which operators argue that their products function as financial instruments rather than wagers.
The CFTC operates as a serious regulator with deep expertise across many areas, but it lacks significant experience in addiction treatment and the behavioral science of compulsive wagering. Kalshi designed SelfExclude and its broader consumer protection hub, which includes deposit limits, break tools, and voluntary opt-outs, to integrate responsible gambling principles into a CFTC-regulated framework.
However, operators implement these tools voluntarily, and regulators do not enforce them through mandatory compliance mechanisms like those in state gambling frameworks.
A New Jersey online casino operator that fails to honor a self-exclusion request risks losing its license, but CFTC-regulated platforms do not face the same level of enforcement.
What a Federal Standard Could Look Like
Congress could create a nationwide exclusion register by passing legislation that establishes a baseline level of consumer protection obligations for any product with gambling-like characteristics.
Lawmakers could design such a framework to mandate participation in a unified national exclusion database, along with minimum standards for deposit limits and cool-off periods. They could implement this approach without forcing prediction markets to abandon their CFTC regulatory status or concede their legal arguments about the nature of their products.
This type of reform remains politically ambitious in the current environment. However, SelfExclude represents a starting point. The way industry stakeholders and regulators respond to it will ultimately signal what type of marketplace prediction markets intend to build.
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