NY Bans Sports Betting on Prediction Markets in 2026
As New York lawmakers opened the 2026 legislative session on 7 January, gambling policy quickly returned to the agenda, with new proposals targeting prediction markets and their growing involvement in sports-related contracts.
Among the measures introduced is the ORACLE Act, Assembly Bill A09251, put forward by State Assemblymember Clyde Vanel. The bill would prohibit prediction market platforms from offering sports betting-style contracts to New York residents, directly addressing products that have become central to platforms such as Kalshi and Polymarket.
If enacted, the legislation would bar contracts tied to individual athletic events, including game outcomes and in-game propositions. Tournament-wide contracts, such as overall champions or bracket-style competitions, would remain permissible under a narrow carveout.
What the ORACLE Act Proposes
Assembly Bill A09251 would create a new Article 48 within New York’s General Business Law, establishing a formal state-level framework for prediction markets while sharply limiting the scope of allowable contracts.
In addition to sports-related markets, the bill outlines several other categories of prohibited contracts. These include markets linked to political elections or government actions, catastrophic events such as war or natural disasters, death or assassination scenarios, and contracts tied to the performance of publicly traded securities.
The proposal also introduces extensive operational and consumer protection requirements. Platforms would be required to restrict access to users aged 21 and over, suspend accounts belonging to minors, and prohibit participation by employees, insiders, and individuals who have self-excluded. Credit card funding and gift certificate sales would be banned, and the use of “risk-free” promotional language would be prohibited.
Financial penalties for violations escalate quickly. Civil fines would begin at $10,000 per violation and could rise to $50,000 for persistent conduct. In cases involving excluded participants or prohibited markets, penalties could reach twice the profits earned. Platforms that continue operating after a court-ordered shutdown could face daily fines of up to $1 million.
Sports Contracts at the Center of the Debate
Sports-related contracts have become a key driver of prediction market activity, operating under the oversight of the Commodity Futures Trading Commission. Their expansion has increasingly drawn attention from state lawmakers, particularly as these platforms gain mainstream visibility through partnerships and marketing activity.
The bill emerges alongside broader gambling discussions in Albany. State Senator Joe Addabbo, who has previously sponsored legislation targeting illegal sweepstakes casinos, has indicated that prediction markets remain under active review. While Addabbo has suggested regulation may be preferable to outright bans, the ORACLE Act reflects a more restrictive approach.
What Comes Next
The ORACLE Act remains in committee and would take effect one year after enactment if approved. The bill includes severability provisions and grants rulemaking authority to the attorney general.
Industry stakeholders are expected to challenge the proposal, arguing that federal oversight should preempt state restrictions. How that conflict is resolved may shape the future of prediction markets not only in New York, but across other states considering similar action.
As reviewed by iGaming News Today, the proposal highlights a growing tension between state gambling frameworks and emerging prediction market models that blur traditional regulatory boundaries.
Follow For More: LinkedIn
