Ohio lawmakers are weighing legislation that would subject prediction market platforms offering sports-related contracts to the same rules as licensed sportsbooks, as legal battles over their status continue.
State Sen. Bill DeMora introduced Senate Bill 430 to create a regulatory structure if courts allow prediction markets to operate freely. The bill would require licensing and taxation similar to sports betting. “If somehow we lose the court cases, and they say, well, they can do this, then they ought to be taxed for it,” DeMora said. “They ought to be regulated.”
Ongoing Legal Fights Drive Proposal
Ohio is among several states challenging prediction market operators, arguing they violate gambling laws. Companies such as Kalshi contend they fall under federal oversight by the Commodity Futures Trading Commission.
DeMora criticized the model, calling one operator “a sham” and equating its offerings with sports betting. “They need to be regulated like everybody else,” he said. “They need to pay the same amount of taxes everybody else is paying, and because they’re doing what everyone else is doing – I don’t care if they call it differently –they’re taking wagers on sporting events. And we have a law for that.”
Court decisions have varied, increasing the chance of a US Supreme Court review. A federal appeals court recently denied Kalshi’s request to block Ohio action while accelerating the case, while another appellate ruling favored the company in a separate dispute.
Differences Between Prediction Markets And Sportsbooks
Despite similarities, prediction markets operate differently from traditional sportsbooks. Instead of betting against an operator, users trade contracts with one another, with prices typically ranging from one cent to 99 cents. Winning contracts pay out $1 per share, and participants can buy or sell positions before an event concludes.
Sportsbooks, by contrast, accept wagers directly and keep losing bets as revenue. In Ohio, licensed sportsbooks reported more than $1 billion in revenue last year, generating nearly $210 million in tax revenue under the state’s 20 per cent tax rate. Most of that funding supports education, with additional allocations for problem gambling programs.
Prediction markets also differ in eligibility rules, allowing participation from individuals aged 18 and older, while Ohio requires sportsbook bettors to be at least 21.
Broader Legislative Debate
DeMora’s proposal is one of several gambling-related measures under consideration in Ohio. Some lawmakers have taken a more restrictive approach, including a proposal from House Republicans that would eliminate online sports betting and limit wagering to physical casinos.
Another bill introduced by State Sen. Louis Blessing would add a 2 per cent tax on the total amount wagered by sportsbooks, while keeping the existing tax on revenue.
DeMora said federal action is unlikely soon and urged state-level responses. “I think states need to do what they need to do,” he said. “I mean, if we pass this bill and (prediction markets win), the state makes some money. They become regulated.”
With ongoing court cases and legislative proposals unfolding simultaneously, the future of prediction markets in Ohio remains uncertain, as policymakers weigh how to classify and oversee a rapidly evolving segment of the gambling industry.
Source:
“Ohio Bill Would Require Prediction Markets Offering Sports Contracts to be State-Licensed and Taxed”, gamblinginsider.com, April 28, 2026
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