Ohio Bill Would Require Prediction Markets Offering Sports Contracts to be State-Licensed and Taxed

An Ohio state senator filed a bill Monday that would make prediction market operators offering contracts on sporting events in the Buckeye State subject to the state’s regulations on sports betting.

Sen. Bill DeMora (D-Columbus) told Gambling Insider Monday evening that his Senate Bill 430 would provide a framework for his state to oversee prediction markets’ actions in the event the U.S. Supreme Court rules in their favor instead of the states, like Ohio, trying to block them.

“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.”

DeMora, the lead Democrat on the Ohio Senate Select Committee on Gaming, is one of the more well-versed state lawmakers on gambling issues.

He did not hold back on his thoughts about Kalshi during his interview with Gambling Insider. The first-term state senator, who is running for re-election this year, considers the major U.S. prediction market operator “a sham” with their markets on sporting events tantamount to sports betting.

They need to be regulated like everybody else,” DeMora continued. “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.”

Prediction Market Court Cases Moving Along

Currently, Ohio is one of several states that have sued Kalshi or other prediction market operators for violating state laws pertaining to gaming. Kalshi and its competitors argue that the U.S. Commodity Futures Trading Commission is the only entity that can regulate their businesses.

Even the CFTC has filed suits against certain states in an attempt to bar them from blocking prediction market activity in their jurisdictions.

Two weeks ago, the Ohio Casino Control Commission announced its intent to issue a $5 million fine to New York-based operators for taking sports bets in the state without a license.

Late Friday, a three-judge panel from the U.S. Sixth Circuit Court of Appeals denied Kalshi a preliminary injunction against Ohio officials, but at the same time fast-tracked the appeal. Kalshi is expected to file its brief by May 5, with Ohio officials responding by June 4.

Then, on Monday, the same court approved Kalshi’s request to have the state of Tennessee’s appeal of a lower court’s ruling granting the exchange an injunction preventing the state’s Sports Wagering Council from taking action similar to that of Ohio.

By contrast, earlier this month, a three-panel from the U.S. Third Circuit Court of Appeals sided, in a split decision, in favor of Kalshi in its case against New Jersey officials, who sought to stop it from offering sporting event contracts there.

‘States Need to do What They Need to do’

Those conflicting decisions at the federal district and appellate court levels increase the likelihood of the question going before the Supreme Court. The bigger question regarding SCOTUS is when the case would come before them.

There is a chance that Congress could take action as well, as several senators and House members from both the Democratic and Republican parties have filed bills, or plan to, that would restrict prediction markets from offering contracts on sporting events and other activities that concern them, such as wars, terrorist attacks, or assassinations. Other lawmakers have focused on ways to prohibit insider trading.

However, DeMora believes the current Congress is too dysfunctional right now, especially with a major election almost six months away, to do anything. He also feels other states should follow his lead.

I think states need to do what they need to do,” DeMora told Gambling Insider. “I mean, if we pass this bill and (prediction markets win), the state makes some money. They become regulated.”

The Ohio Legislature meets throughout the year in Columbus, with sessions currently scheduled for mid-May and weekly in June. Additional sessions will likely take place after the November general election.

A message sent late Monday to Kalshi seeking comment on SB430 was not immediately returned.

Differences Between Sportsbooks and Prediction Markets

There are some fine differences between the two that go beyond which level of government regulates them.

First, people who bet through a sportsbook bet against the operator that created the market. Prediction markets serve as a facilitator between two people who want action on opposite sides of the same contract (ie, one person wants to buy a team giving their opponent 7.5 points in their next game, and the other individual wants to take the opponent getting the points) if both sides can agree on a price.

Prices on prediction market contracts typically run between a penny and 99 cents, with those holding the winning side earning $1 for each share. Prediction markets also allow traders to buy or sell before the event concludes, giving those people a chance to secure a profit or cap losses.

Prediction markets can take orders from anyone age 18 or older. Ohio require bettors to be 21 or older.

Sportsbooks take a customer’s wager, and if the bettor loses, it becomes revenue for them. In Ohio last year, state-licensed books reported more than $1 billion in revenue. The state taxes revenues at 20%, which meant it received nearly $210 million in 2025. Nearly all of those dollars go toward elementary and secondary education, with money also set aside for problem gambling resources.

Prediction markets earn commissions on trades. However, they also have market makers, which can be part of the company or a partner, to provide liquidity and facilitate trading.

State-licensed sportsbooks also must adhere to regulations in that state. For instance, a few years ago, the OCCC banned prop bets on individual college athletes. While a sportsbook like DraftKings or FanDuel can’t offer those in Ohio, a prediction market does not need to abide by state rules.

Other Gaming Bills in Ohio

DeMora’s proposal is one of a few bills related to sports betting or gambling in the Ohio Legislature.

Nearly three weeks ago, a group of Republican House members unveiled their “Save Ohio Sports Act,” which would ban online sports betting in the state and limit wagering to just the state’s four full-fledged casinos. A check of the Ohio Legislature’s list of filed bills did not appear to show the act, which the sponsors said would take up two pieces of legislation, has been filed as of Monday night.

In addition, state Sen. Louis Blessing (R-Colerain Township) has filed a bill that would levy another 2% tax on sportsbooks. However, this tax would be on sportsbooks’ handle, or the total amount of money they take, and it would still keep the 20% tax on revenue, which is the amount of money the sportsbooks retain after they pay winning bettors.