Hawaii Bill Seeks to Prohibit Sports Event Contracts

• An introduced Hawaii bill seeks to define sports event contracts as illegal gambling
• The contracts “prey upon a gap in Hawaii’s gambling laws”
• The prohibition will extend to all event contracts relating to sports, contests, people, politics, catastrophe, and death

Prediction markets are now in the crosshairs of Hawaiian legislators

Lawmakers recently introduced HB 2198, which seeks to define prediction markets as illegal gambling in the state. The legislation will effectively prohibit all event contracts related to sports, contests, people, politics, catastrophe, and death.

Hawaii is one of two states in the country that does not have any form of legalized gambling or lottery.

Ban on Prediction Markets?

The legislators who introduced the bill reported that recent developments have “allowed individuals to create financial incentives and motivations for the occurrence of events involving athletics, politics, catastrophe, and death.” Fifteen Hawaii legislators have signed onto the bill.

The bill seeks to update Hawaii’s gambling laws to prohibit prediction event contracts relating to sports, contests, people, politics, catastrophe, and death.

If approved, the bill will prohibit the sale of event contracts related to sports, which are defined as the following:

“Sports, including an outcome that relates to a specific athletic event or non-athletic sporting event or events within an athletic event or non-athletic sporting event or events.”

Additionally, the legislation will prohibit the sale of event contracts related to politics, which includes the outcomes of elections, anything related to war or emergencies, and any outcome related to death.

The bill has yet to be assigned to a specific committee.

No Prediction Markets, Sports Betting Still Up in Air

As lawmakers set their sights on banning certain prediction market contracts in the Aloha State, it is likely that sports betting will again be considered for legalization this year.

Both the Hawaii Senate and House passed versions of Rep. Daniel Holt’s bill, HB 1308,  to legalize Hawaii sports betting in 2025. However, key amendments to the bill led to a required conference committee, which did not lead to a consensus between the House and Senate for approval. .

Holt’s bill allowed at least four online sports betting licenses to be awarded to operators in the state. The likeliest reason the bill failed? A fundamental disagreement between the House and Senate on the legislation’s proposed tax rate and licensing fees.

Hawaii legislators did say the issue would be discussed again in 2026, but lawmakers will have to reach an agreement on tax rates and licensing fees for anything to be approved.