Key Highlights
- State Senator Bill DeMora introduced SB 430 aimed at bringing prediction market platforms under Ohio’s sports betting regulatory framework
- Platforms offering sports-related contracts would need state licensing and face identical tax obligations as traditional sportsbooks
- Multiple federal courts have reached different conclusions regarding state authority over prediction market regulation
- Ohio’s Casino Control Commission initiated a $5 million penalty action against Kalshi for operating without proper state authorization
- Additional gaming legislation under consideration includes a proposal to eliminate online sports wagering completely
A Democratic lawmaker from Ohio has put forward legislation that would compel prediction market platforms to adhere to identical regulations as state-authorized betting operators when offering sports-related contracts to Ohio residents.
Columbus-based Senator Bill DeMora introduced Senate Bill 430 on Monday as a contingency measure. Should the nation’s highest court rule favorably for prediction markets in current litigation, DeMora’s proposal would ensure Ohio maintains regulatory and taxation authority over 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 told Gambling Insider.
As the ranking Democratic member of Ohio’s Senate Select Committee on Gaming, DeMora characterized Kalshi—the nation’s most prominent prediction market operator—as “a sham” and contended that contracts on sporting events are functionally identical to traditional 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.”
Divergent Federal Rulings Create Regulatory Uncertainty
Ohio joins multiple states pursuing legal action against Kalshi for purported violations of state gaming regulations. The company and similar platforms contend that exclusive regulatory jurisdiction belongs to the U.S. Commodity Futures Trading Commission.
The CFTC has initiated its own litigation against certain states attempting to restrict prediction market operations within their borders.
Two weeks prior, Ohio’s Casino Control Commission revealed intentions to impose a $5 million penalty on the New York-headquartered company for accepting sports wagers without proper state authorization.
Last Friday, a three-member panel of the U.S. Sixth Circuit Court of Appeals rejected Kalshi’s request for a preliminary injunction preventing Ohio authorities from enforcement actions. The appellate court did, however, expedite the appeal process, establishing a May 5 deadline for Kalshi’s brief and June 4 for Ohio’s answering brief.
That same Monday, the identical court granted Kalshi’s petition to consider Tennessee’s challenge to a district court decision that had prevented state enforcement against the platform.
Earlier this month, judges from the U.S. Third Circuit Court of Appeals issued a divided ruling favoring Kalshi in its dispute with New Jersey regulators.
These contradictory federal appellate decisions increase the probability that the Supreme Court will ultimately address the jurisdictional question.
Additional Gaming Legislation Under Consideration
DeMora expressed skepticism about congressional action on prediction markets, citing partisan gridlock and the approaching election cycle. He urged individual states to develop their own regulatory approaches.
Structural distinctions exist between traditional sportsbooks and prediction markets. Sportsbooks function as direct counterparties to wagers, whereas prediction markets facilitate peer-to-peer contracts between participants taking opposing positions. Prediction markets permit participation at age 18, while Ohio mandates that sports bettors reach age 21.
Licensed sports betting operators in Ohio generated over $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 funding.
DeMora’s proposal represents one of multiple gambling-related measures currently before Ohio’s legislature. Republican House members recently presented the “Save Ohio Sports Act,” which would prohibit online sports wagering entirely and restrict betting activities to the state’s four casino properties.
Republican Senator Louis Blessing has separately introduced legislation establishing an additional 2% tax on total wagering handle, supplementing the current 20% revenue tax.
The Ohio Legislature has scheduled sessions for mid-May and weekly throughout June, with additional sessions anticipated following the November election. Kalshi had not provided a response to requests for comment regarding SB 430 at publication time.
