Minnesota Prediction Market Ban Heads To Senate Floor

Minnesota lawmakers have advanced a prediction market ban bill that could create the first state-level legislative ban of its kind in the US. The Senate Finance Committee approved the measure Friday without opposition, sending it to the full Senate.

Good to Know

• The bill targets prediction markets tied to sports, politics, court outcomes, legislation, and violent events.
• Minnesota does not allow legal retail or online sports betting.
• Prediction market operators would likely challenge the bill in court if it becomes law.

Minnesota Targets Event Contracts Before Senate Vote

Sen. John Marty is pushing the bill as a clarification of Minnesota gambling law. He argues prediction market companies use federal commodities rules to present event contracts as investment products, while marketing them to consumers as wagers on real-world outcomes.

The bill now awaits a Senate floor vote. If senators pass it, the House must also approve the measure before it can become law.

The proposal covers a wide range of event contracts. Sports contests, elections, legislative actions, court rulings, and events tied to death or violence would all fall under the ban. However, Minnesota would still allow existing carveouts such as the state lottery, raffles, and limited social betting, including informal March Madness pools.

The legislation also narrows protection for futures contracts. Under the bill, a futures product would lose its exemption if a company structures or markets it like a betting product.

Marty told the Senate Finance Committee that prediction markets have spread quickly and created confusion over where investing ends and gambling begins. He also said the measure does not add new criminal penalties or fresh enforcement powers. Instead, supporters say it gives regulators clearer footing under current law.

A legal fight would be likely. Prediction market operators, and possibly federal officials, have argued that federal regulators hold exclusive authority over these platforms. Minnesota would therefore test how far state gambling laws can go against event contracts.

The debate also comes as Minnesota remains one of 11 states without legal retail or online sportsbooks. A sports betting legalization bill introduced during the current legislative session has made little progress and appears unlikely to pass.