Connecticut Seeks Prohibition of Prediction Markets For Those Under 21

• Connecticut Gov. Ned Lamont (D) today introduced a bill to set an age limit of 21-and-older to purchase event contracts
• Legislation also prohibits advertisements aimed at those under 21 or at college campuses
• Several states have introduced legislation to curtail prediction markets

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Connecticut Gov. Ned Lamont (D) is hoping to limit prediction markets to state residents who are at least 21 years old.

Gov. Lamont today introduced Governor’s Bill 5038, which sets an age limit of 21 to access prediction markets in the Constitution State. Prediction markets companies typically allow customers who are 18 to purchase event contracts.

Connecticut joins a growing list of states who are introducing legislation to either regulate prediction markets or prohibit them entirely.

Prohibiting Underage Advertising

In addition to limiting prediction market access to state residents who are 21 years of age, the bill also prohibits advertisements for a prediction market platform to be directed or targeted to those who are underage or aimed exclusively at consumers at college campuses.

Prediction market advertisements will also not be allowed to contain images, symbols, celebrity or entertainer endorsement designed to appeal to those under 21.

If a prediction market platform allows a consumer under 21 to purchase an event contract, the provider will be required to suspend the consumer’s account, close all positions on the account, pay out to the consumer ay funds in the account, and prohibit the consumer from further use of the provider’s platform until they are 21.

Connecticut has targeted prediction markets over the last several months. The Connecticut Department of Consumer Protection Gaming Division issued cease-and-desist notices to Kalshi, Robinhood, and Crypto.com for their sports event contracts, reporting that all three platforms are offering sports wagers in violation of state law and without license.

The letters were sent to KalshiEX LLC, Robinhood Derivatives, LLC, and Crypto.com, ordering an immediate cessation of all advertising and offering of sports event contracts to Connecticut residents.

“Only licensed entities may offer sports wagering in the state of Connecticut,” said Department of Consumer Protection (DCP) Gaming Division Commissioner Bryan T. Cafferelli in a release. “None of these entities possess a license to offer wagering in our state, and even if they did, their contracts violate numerous other state laws and policies, including offering wagers to individuals under the age of 21.”

The governor’s bill is the latest Connecticut attempt to curtail prediction markets and the latest state to proposed legislation to do so.

States Introducing Legislation Against Prediction Markets

Connecticut joins a growing list of states that are hoping to take legislative action against prediction market platforms.

Last week, Hawaii lawmakers 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.

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.

Iowa legislators are taking a different tact regarding prediction markets. Sen. Mike Klimesh (R-32) introduced SF 2085, which seeks to regulate prediction market contracts. If approved, prediction market platforms would have to acquire a license for $10 million and pay a 20% tax rate on adjusted revenues on event contracts.

These would include contracts regarding sports, elections, economic indicators, and legislative actions.

Also, Illinois Rep. Edgar González, Jr. (D-104) today introduced HB 5059, which prohibits the sale of sports event contracts, raises the minimum age to 21 to participate in prediction markets, and requires additional responsible gaming measures from providers.