Monthly Industry Report
Operators doubled down on prediction markets at Q1 earnings, the sweepstakes ban wave hit three more states, Macau posted its strongest May since the pandemic, and Brazil moved to rewrite its Bets Law — all in May 2026.
Executive Summary
May 2026 was defined by the prediction-market battle moving in two directions at once. At the federal level, momentum built fast: the White House began reviewing a CFTC oversight proposal on May 27, Kalshi unveiled perpetual futures on May 29, and DraftKings and FanDuel used their May 6 Q1 earnings calls to position prediction markets as a core growth engine — DraftKings raising its predictions investment to $200M–$300M for the year. Yet the state level pulled the other way: Tennessee, Louisiana and Oklahoma all banned online sweepstakes casinos, Illinois issued 65 cease-and-desist letters, and the NBA betting scandal widened with a superseding indictment against Terry Rozier. Internationally, Macau delivered a strong May with GGR up 6.7% to $2.80B, while Brazil's regulated 'Bets' market faced a fresh legislative assault that ranged from tighter rules to an outright ban. The month captured an industry simultaneously expanding into new products and absorbing intensifying regulatory and integrity pressure.
Key Market Metrics
US sportsbooks produced $3.82B in gross gaming revenue on $40.47B handle through Q1, tracking ahead of 2025's full-year $16.80B GGR.
Combined Kalshi + Polymarket monthly trading volume reached roughly $24B in April, up from under $5B in September 2025 (Pew).
Macau casino GGR rose 6.7% YoY to MOP22.61B in May and 13.7% from April, lifting year-to-date revenue above MOP108B.
Tennessee became the 9th state to ban online sweepstakes casinos; Louisiana and Oklahoma also enacted bans and Illinois issued 65 cease-and-desist letters.
Current Market Trends
Q1 Earnings: Operators Bet Big on Prediction Markets
First-quarter results landed on May 6. DraftKings reported revenue of $1.646B (up 17% YoY) and $21.1M in GAAP net income, and said it would invest $200M–$300M in its predictions segment in 2026 after annualized consumer volume topped $1B in April. Flutter also reported on May 6 with group revenue up 17% but lowered its full-year guidance on US margin pressure, with FanDuel's handle down 9% as new CEO Christian Genetski took the helm. DraftKings and FanDuel both framed prediction markets as a growth priority, while BetMGM, Penn and Caesars signaled more cautious paths.
Reported May 6, 2026
Prediction Markets Win Federal Momentum as Kalshi Adds Perps
Kalshi announced on May 29 that it would offer perpetual futures contracts — the same day the CFTC, now down to a single member in chair Michael Selig, said it would permit bitcoin-linked perp listings on a case-by-case basis. Two days earlier, on May 27, the White House began reviewing a CFTC proposal to formalize federal oversight of prediction markets, with President Trump publicly backing the agency's 'exclusive authority' over the sector. Combined Kalshi and Polymarket monthly volume hit roughly $24B in April, up from under $5B in September 2025.
May 27–29, 2026
Sweepstakes Casino Ban Wave Accelerates
Tennessee Governor Bill Lee signed SB 2136 on May 22, making Tennessee the ninth state to outlaw online sweepstakes casinos. Louisiana Governor Jeff Landry signed HB 53 and HB 883 — the former adding 'gambling by electronic sweepstakes device' as a racketeering predicate carrying penalties up to 50 years. Oklahoma enacted its own ban, while Illinois regulators took an enforcement route, issuing cease-and-desist letters to 65 operators, many of which began complying.
Signed / enacted May 2026
NBA Betting Scandal Widens with Rozier Superseding Indictment
On May 28, the US Department of Justice filed a superseding indictment alleging former NBA guard Terry Rozier accepted a $100,000 bribe, deepening the federal sports-betting and money-laundering case first unsealed in October 2025. The expanding prosecution keeps integrity and insider-information risk at the center of the US regulatory conversation and fuels scrutiny of player-prop markets.
May 28, 2026
Brazil Escalates Legislative Threat to Its 'Bets' Market
Brazil's recently regulated betting market faced its sharpest political challenge yet. On May 19, ministers introduced Bills 2,470/2026 and 2,478/2026 to rewrite the framework around consumer and mental-health protections, while a May 29 Economic Development Committee hearing debated Bill 180/2026, which proposes a nationwide ban on fixed-odds betting. The push builds on Bill 1,808/2026, filed in April by 68 lawmakers, that would prohibit operations and advertising outright.
Throughout May 2026
Regional Insights
🇺🇸🇨🇦North America
Key Highlights
- •DraftKings posts $1.646B Q1 revenue (+17%) and GAAP net income of $21.1M.
- •Bally's granted Pennsylvania's available online sports betting license.
- •Federal momentum builds for prediction markets — White House review and Kalshi perps.
Challenges
- •Sweepstakes bans spread to Tennessee, Louisiana and Oklahoma, with Illinois enforcement.
- •NBA integrity scandal widens with the Rozier superseding indictment (May 28).
- •FanDuel handle falls 9% as Flutter trims full-year guidance on US margin pressure.
🇪🇺Europe
Key Highlights
- •UK statutory levy (0.1%–1.1% of GGY) funding structures take shape as GambleAware winds down.
- •UKGC proposes routing all future regulatory settlements into the Consolidated Fund.
- •Director of Policy Ian Angus addresses the Lotteries Council annual conference (May 21).
Challenges
- •Operators absorbing the statutory levy alongside tighter consumer-protection requirements.
- •Advertising standards and affordability scrutiny continue to raise acquisition costs.
🇲🇴Asia-Pacific
Key Highlights
- •Macau May GGR rises 6.7% YoY to ~$2.80B (MOP22.61B), up 13.7% from April.
- •Year-to-date Macau revenue tops MOP108B for the first time in 2026 (+10.9%).
- •Labour Day (May 1–5, ~873k visitors) and Buddha's Birthday holidays drive demand.
Challenges
- •Macau's 2026 full-year gaming-tax forecast sits slightly below 2025.
- •Continued reliance on mainland visitation and holiday-period peaks.
🌎Latin America
Key Highlights
- •Regulated market keeps operating pending legislative review.
- •Build-up to the 2026 FIFA World Cup lifts regional engagement and acquisition.
Challenges
- •Brazil advances multiple bills (180/2026, 1,808/2026) that could ban fixed-odds betting.
- •Political pressure over household indebtedness clouds the market's outlook.
Operator Spotlight
DraftKings
DraftKings delivered a standout quarter on May 6 — $1.646B revenue (up 17%) and $21.1M GAAP net income — and leaned hard into prediction markets, raising its 2026 predictions investment to $200M–$300M. Its Railbird Exchange self-certified its first six sports event contracts with the CFTC as annualized predictions volume reached $2.3B.
Flutter / FanDuel
Flutter reported group revenue up 17% on May 6 but cut its full-year guidance on US margin pressure, sending a cautious signal even as the top line grew. FanDuel's handle fell 9% in the quarter as Christian Genetski settled in as CEO following Amy Howe's April departure, and management named prediction markets a FanDuel growth target.
Kalshi
Kalshi rode a wave of federal tailwinds in May. It announced perpetual futures contracts on May 29 alongside the CFTC's bitcoin perp opening, while the White House's May 27 review of a CFTC oversight proposal pointed toward a clearer national framework. Sector-wide prediction volume of ~$24B/month underscored Kalshi's momentum against state-level resistance.
Upcoming Industry Events
2026 FIFA World Cup Kicks Off
The World Cup, co-hosted across the US, Canada and Mexico, is expected to be the largest sports betting event in history. Operators are scaling platforms and launching major acquisition and reactivation campaigns across North America for the tournament's June 11 kickoff.
CFTC Prediction-Market Rule Under White House Review
The federal framework reviewed in late May could define national prediction-market oversight. Its direction will shape the roadmaps of DraftKings, FanDuel and Kalshi against continued state-level resistance to sports event contracts.
Brazil 'Bets Law' Votes Advance
Committee debate on Bill 180/2026 and the May 19 reform bills continues into June. Outcomes range from tighter consumer-protection rules to an outright ban on fixed-odds betting, with major implications for operator market access.
Risk Assessment
Prediction-Market Regulatory Whiplash
Federal momentum — the White House review, Kalshi's perps, and DraftKings/FanDuel entry — is colliding with state-level resistance. Operators face a patchwork where a product blessed by the CFTC can still be challenged by state attorneys general, creating legal and operational uncertainty.
Maintain geofencing and separate wallets per product; monitor the White House/CFTC rulemaking weekly; keep contract self-certifications documented and legally defensible.
Sweepstakes Contraction and Enforcement Spillover
With Tennessee, Louisiana and Oklahoma banning sweepstakes and Illinois issuing 65 cease-and-desist letters, dual-currency models now carry criminal exposure — Louisiana's racketeering penalties reach 50 years. Payment processors and affiliates are likely to pull back from the vertical.
Exit or geofence hostile states immediately; review currency mechanics against new statutory definitions; prepare for processor and affiliate withdrawal.
Sports-Betting Integrity Contagion
The widening NBA prosecution — the Rozier superseding indictment on May 28 — sustains political pressure for integrity controls and could fuel restrictions on player-prop markets, a high-margin category for operators.
Tighten prop-market integrity monitoring; expand suspicious-betting alerts and league data-sharing; pre-empt prop-restriction legislation in compliance planning.
US Margin Pressure and Guidance Cuts
Flutter's lowered full-year guidance and FanDuel's 9% handle decline signal a maturing, costlier US market even as revenue grows. Promotional intensity and customer-acquisition costs are squeezing margins.
Prioritize retention and CAC discipline over share-chasing; diversify into iGaming and prediction-market revenue; stress-test margins against promotional intensity.
Data Sources & Methodology
Research Methodology
This report covers events confirmed to have occurred during May 2026. All statistics are verified through cross-referencing industry reports and official regulatory or corporate data. Events scheduled for future months appear only in the Upcoming Events section.
Primary Sources
- • Flutter Entertainment & DraftKings: Q1 2026 earnings releases (May 6, 2026)
- • Gambling Insider: DraftKings/FanDuel prediction-market Q1 calls; sweepstakes monthly update (May 2026)
- • Axios: Kalshi to offer perpetual futures contracts (May 29, 2026)
- • CNBC: White House reviews CFTC prediction-market proposal (May 27, 2026)
- • Pew Research Center: prediction-market trading volume data (May 27, 2026)
- • SBC Americas / Covers: Tennessee SB 2136 signed into law (May 22, 2026)
- • US DOJ (EDNY) / Gambling News: Rozier superseding indictment (May 28, 2026)
- • SIGMA / World Casino Directory: Macau May GGR +6.7% (May/June 2026)
Supporting Sources
- • Yogonet / SBC News / iGaming Brazil: Brazil betting bills 2,470, 2,478 & 180/2026 (May 19 & 29, 2026)
- • iGaming Expert / GOV.UK / SBC News: UK statutory levy and UKGC settlements direction (May 2026)
- • Legal Sports Report / RG.org: US handle, revenue and Q1 2026 GGR tracking
Note: Regional market-size figures are house mid-point estimates that vary between sources due to differing methodologies and regional inclusions; sourced figures (US Q1 GGR, Macau GGR, operator earnings, trading volumes) are cited to the named primary source above. The US Senate's self-imposed prediction-market trading ban (April 30) and FanDuel CEO Amy Howe's departure (April) were April events and are intentionally excluded from this month's trends. All data current as of May 31, 2026. Every factual claim is tied to a verifiable source — if a source cannot be identified, the claim is removed.