Key Points
- Ohio Senator Bill DeMora introduced SB 430 to bring prediction markets offering sports-related contracts under state sports betting regulations
- The proposed legislation would mandate that prediction market platforms secure state licenses and remit taxes equivalent to traditional sportsbooks
- Multiple federal circuit courts have delivered contradictory decisions regarding state authority over prediction market regulation
- The Ohio Casino Control Commission has announced intentions to impose a $5 million penalty on Kalshi for operating without proper licensing
- Multiple gambling reform measures are under consideration in Ohio’s legislature, including a proposal to eliminate online sports wagering
An Ohio lawmaker has put forward legislation this week aimed at bringing prediction market platforms under the same regulatory framework as traditional sports betting operators when they facilitate wagering on athletic competitions within state borders.
Columbus Democrat Sen. Bill DeMora submitted Senate Bill 430 as a contingency measure. Should the nation’s highest court rule in favor of prediction markets in current litigation, his legislation would ensure Ohio maintains authority to impose taxes and oversight on these platforms.
“If somehow we lose the court cases, and they say, well, they can do this, then they ought to be taxed for it,” DeMora explained to Gambling Insider.
As the ranking Democrat on Ohio’s Senate Select Committee on Gaming, DeMora characterized Kalshi—the nation’s leading prediction market platform—as “a sham” and maintained that its sports-related contracts are functionally identical to traditional sports wagers.
“They need to be regulated like everybody else,” he stated. “They need to pay the same amount of taxes everybody else is paying.”
Circuit Courts Issue Contradictory Rulings on State Authority
Ohio joins a growing number of states pursuing legal action against Kalshi for alleged violations of state gaming statutes. Kalshi and similar platforms contend that regulatory oversight falls exclusively under the jurisdiction of the U.S. Commodity Futures Trading Commission.
The CFTC has initiated its own legal challenges against specific states attempting to restrict prediction market operations.
Two weeks prior, the Ohio Casino Control Commission revealed its intention to levy a $5 million penalty against the New York-headquartered operator for accepting sports wagers without appropriate state authorization.
Last Friday, a three-judge panel at the U.S. Sixth Circuit Court of Appeals rejected Kalshi’s request for preliminary injunctive relief against Ohio regulators. The court simultaneously expedited the appeals process, setting a May 5 deadline for Kalshi’s brief and June 4 for Ohio’s counter-filing.
This Monday, the same judicial panel granted Kalshi’s petition to consider Tennessee’s challenge to a district court decision that had prevented the state from enforcing action against the platform.
Earlier in the month, judges at the U.S. Third Circuit Court of Appeals ruled in Kalshi’s favor in a divided opinion concerning New Jersey authorities.
These divergent federal court interpretations increase the probability that the matter will ultimately require Supreme Court resolution.
Additional Gaming Legislation Under Consideration in Ohio
DeMora expressed skepticism that Congress would address prediction markets legislatively, citing political polarization and the proximity of major elections. He urged individual states to develop their own regulatory approaches.
Fundamental operational distinctions exist between sportsbooks and prediction markets. Traditional sportsbooks accept wagers directly from customers, whereas prediction markets facilitate contracts between users holding opposing positions. Prediction market participants need only be 18 years old, contrasting with Ohio’s 21-year minimum age requirement for sports betting.
Licensed sportsbooks operating in Ohio generated more than $1 billion in revenue during the previous year. The state applies a 20% tax on that revenue, collecting approximately $210 million in 2025, with the majority allocated to educational programs.
DeMora’s proposal represents one of multiple gambling-focused bills currently before Ohio’s Legislature. Republican House members recently introduced the “Save Ohio Sports Act,” legislation that would prohibit online sports betting entirely and restrict all wagering activities to the state’s quartet of brick-and-mortar casinos.
Republican Sen. Louis Blessing has separately introduced legislation that would establish a 2% tax on the total handle processed by sportsbooks, supplementing the current 20% revenue tax.
The Ohio Legislature has scheduled sessions for mid-May and weekly throughout June, with additional meetings anticipated following November’s general election. Kalshi did not provide immediate comment when contacted regarding SB 430.
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