Missouri AG Looks to Protect Its Market From Sports Contracts

The Show-Me State is joining a growing list of opponents to sports prediction markets.

Missouri Attorney General Catherine Hanaway called for the controversial industry to be regulated the same as sports betting. This would include the same rules, licensing requirements, and taxes. While she hasn’t filed any lawsuits to back up her belief, the statement represents another Republican state growing wary of sports prediction markets.

Hanaway’s statement did not mention plans to sue operators offering sports markets. However, her words suggest that could be under consideration.

Sports Markets Are Sports Betting

Missouri’s AG didn’t criticize the legality of sports markets, but made it clear she sees it as a form of gambling. As a result, she believes they should be required to join the state’s regulated market.

If these prediction markets allow sports betting on their platforms, then we think they should pay the same taxes as any of those other platforms and have the same regulatory structure.

Her words echo the same argument being made in courtrooms across the US. However, the distinction between sports contracts and wagers will likely be made by the US Supreme Court in the coming months. 

Criticism of Prediction Platforms Grows

When Kalshi began testing out sports prediction markets, the debate over their legality was largely divided along party lines. The White House’s support led many Republicans to back the industry, but that has been changing over the last year.

Today, a bipartisan group of 44 states has spoken out against sports betting markets. Some have taken it a step further, filing lawsuits to shut them down. Democrats lead most of those markets, but conservative states like Utah, Ohio, and Tennessee have joined them.

While Missouri isn’t actively fighting the embattled industry, Hanaway's words show it continues to bleed support. 

Will Operators Listen?

The prediction industry hopes the US Supreme Court will rule in its favor and end the legal fights. However, recent rulings across the country have begun to shift momentum against it. This, along with the bipartisan opposition, has many expecting the industry’s era of federal regulation to be coming to an end. 

Missouri’s market is one of the most operator-friendly in the country. Licensing fees are low, and the 10% tax rate is among the lowest in the country. It is an ideal market for a sports betting operator, but don’t count on prediction market platforms clamoring to get in.

While joining regulated state markets would save a fortune in legal fees, it would also erase the industry’s biggest advantage over sportsbooks. The lack of regulations and taxes allows sports markets to offer more options and better pricing than online sportsbooks. As a result, it seems unlikely that operators will take Hanaway up on her request.