Key Highlights
- State Senator Bill DeMora introduced SB 430 targeting prediction market platforms that offer sports-related contracts
- Proposed legislation mandates licensing and tax compliance equivalent to traditional sports betting operators
- Multiple federal appellate courts have delivered contradictory decisions regarding state authority over prediction markets
- Ohio’s gaming regulator seeks $5 million penalty against Kalshi for operating without proper authorization
- Multiple gaming-focused legislative proposals are under consideration, including complete prohibition of online wagering
A Democratic lawmaker in Ohio has put forward legislation this week designed to subject prediction market platforms to identical regulatory standards as licensed sports wagering operators when they facilitate contracts based on athletic competitions.
Columbus-based Senator Bill DeMora submitted Senate Bill 430 as a contingency measure. Should federal courts ultimately rule in favor of prediction market companies in current litigation, the proposed law would establish Ohio’s framework for taxation and oversight.
“If somehow we lose the court cases, and they say, well, they can do this, then they ought to be taxed for it,” DeMora told Gambling Insider.
As the ranking minority member on Ohio’s Senate Select Committee on Gaming, DeMora characterized Kalshi—currently the nation’s leading prediction market platform—as operating under false pretenses, asserting that sports-based contracts on such platforms function identically to conventional sports wagers.
“They need to be regulated like everybody else,” he said. “They need to pay the same amount of taxes everybody else is paying.”
Appellate Courts Issue Contradictory Rulings on State Oversight
Ohio joins a growing coalition of states pursuing legal action against Kalshi over alleged violations of state gaming statutes. The prediction market industry maintains that exclusive regulatory authority belongs to the U.S. Commodity Futures Trading Commission.
The CFTC has simultaneously initiated legal proceedings against various states attempting to restrict prediction market operations.
Two weeks prior, Ohio’s Casino Control Commission revealed intentions to levy a $5 million penalty against the New York-headquartered platform for accepting sports-related wagers without state authorization.
Last Friday, a three-member panel of the U.S. Sixth Circuit Court of Appeals rejected Kalshi’s petition for preliminary injunctive relief against Ohio authorities. Despite this setback, the appellate court expedited the proceedings, establishing May 5 as the deadline for Kalshi’s brief submission and June 4 for Ohio’s counter-arguments.
The following Monday, the identical court granted Kalshi’s motion to consider Tennessee’s challenge to a district court decision that prevented state enforcement actions against the platform.
Earlier in the current month, judges from the U.S. Third Circuit Court of Appeals rendered a divided opinion favoring Kalshi in its dispute with New Jersey regulators.
These divergent federal appellate decisions increase the probability that the Supreme Court will eventually address the jurisdictional question.
Additional Gaming Legislation Under Ohio Consideration
DeMora expressed skepticism about congressional action on prediction market regulation, citing partisan gridlock and proximity to major electoral contests. He advocated for individual state-level initiatives.
Fundamental operational distinctions exist between traditional sportsbooks and prediction markets. Conventional bookmakers directly accept wagers, whereas prediction markets facilitate peer-to-peer contract matching. Prediction platforms permit 18-year-old participants, while Ohio mandates a 21-year minimum age for sports betting.
Licensed sports betting operations in Ohio generated over $1 billion in revenue during the previous calendar year. The state applies a 20% tax rate on that revenue, collecting approximately $210 million in 2025, with educational programs receiving the majority of proceeds.
DeMora’s proposal represents one component of multiple gambling-related measures advancing through Ohio’s legislative process. Republican House members recently presented the “Save Ohio Sports Act,” legislation that would eliminate online sports wagering entirely and restrict all betting activity to the state’s quartet of casino facilities.
Republican Senator Louis Blessing has separately introduced legislation adding a 2% assessment on total betting handle to complement the current 20% revenue taxation.
The Ohio General Assembly has scheduled sessions for mid-May and each week throughout June, with additional meetings anticipated following November elections. Kalshi had not provided commentary on SB 430 at the time of publication.
