Ohio Commission Warns Sportsbooks over Prediction Markets
The Ohio Casino Control Commission (OCCC) has issued a stern warning to sportsbooks considering venturing into prediction markets, cautioning that such activities could jeopardize their licenses. The regulator is drawing a firm line, as major operators like FanDuel and DraftKings explore these betting options, highlighting a growing tension between state gambling laws and federally regulated event contracts.
LISTEN TO THIS ARTICLE:The OCCC, under Executive Director Matthew Schuler, sent a letter to all sports gaming licensees on August 25, 2025, reminding them that the offering of “sporting event contracts” without proper state licensing is strictly prohibited. The letter emphasizes that prediction markets tied to sports outcomes fall under Ohio’s sports gaming regulations (R.C. Chapter 3775) and cannot be offered under the guise of federally regulated futures trading.
The regulator warned that violators would face severe penalties, including fines and license revocation.
The Commission will not permit sports gaming to be offered under the pretext of event contracts without proper licensure, nor will the Commission permit a licensee to avoid administrative action by implementing geofencing to prevent Ohioans from accessing their sports gaming offerings in Ohio. The Commission will consider a licensee’s choices to associate with a company operating illegally in this State and may take administrative action against any licensee that does.
The OCCC, like other state gambling authorities, fears that prediction markets, which allow bets on binary outcomes like game results or player performances, could bypass state oversight if misclassified as derivatives.
In April, the watchdog issued cease-and-desist notices to Kalshi, Robinhood, and Crypto.com, ordering them to halt trading on sports-related event contracts or face legal consequences.
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Industry Giants Test the Waters
The OCCC’s warning comes amid growing industry interest in prediction markets, driven by their potential to blend financial trading with event forecasting. FanDuel’s parent company, Flutter Entertainment, announced a joint venture with CME Group on August 20 to launch an events-based trading product focused initially on non-sports categories like oil prices and the S&P 500.
DraftKings CEO Jason Robins also expressed interest in the sector's potential, stating in a recent investor call that the company is “actively exploring opportunities in this evolving landscape.”
Platforms like Kalshi, regulated by the U.S. Commodity Futures Trading Commission (CFTC), argue their event contracts are legal nationwide, even in states without sports betting, such as California and Texas. Kalshi began offering sports-related contracts in January 2025 and has since expanded, attracting partnerships like Robinhood, which will integrate Kalshi’s NFL contracts this season.
Prediction markets are about empowering people to express their views on future outcomes with real stakes, and we’re committed to operating within federal guidelines.
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