Texas Lt. Gov. Dan Patrick, a longtime opponent of sports betting, is now focusing his attention on ridding the Lone Star State of prediction markets, likely driving more residents to seek out safe offshore sportsbooks.
Texas Gunning for Prediction Ban
Earlier this year, Lt. Governor Dan Patrick instructed state senators to examine ways to shut down what he described as “gambling loopholes” that allow platforms like Kalshi and Polymarket to operate within Texas.
In his role leading the Senate, Patrick has consistently and successfully blocked efforts to legalize sports betting in the state, and now his attention has shifted to prediction markets offering sports event contracts throughout the nation, including Texas.
His latest push comes as lawmakers nationwide weigh how to handle prediction markets, while state gambling regulators are locked in legal disputes with operators and the Commodity Futures Trading Commission (CFTC). State officials argue that contracts tied to sports outcomes on these platforms amount to unlicensed betting, which they believe undermines existing gambling laws and could lead to increased regulation and enforcement challenges.
Speaking of which, Texas is one of the few states without mobile sports betting or commercial casinos. Therefore, the advent of prediction markets offering what is essentially sports-betting opportunities has rankled Texas’s rank-and-file establishment.
Patrick has asked the State Affairs Committee to examine whether federal oversight is being used to bypass Texas gambling laws. The panel, which can meet during off years when the legislature is not in session, has not yet scheduled any hearings.
“Study the sudden inundation of prediction market gambling and exploitation of federal law to circumvent Texas gambling prohibitions by allowing users to place bets on the outcome of elections and other events,” his directive reads. “Examine the relationship between federally regulated derivative markets and state-prohibited gambling.”
Critics Support Patrick’s Anti-Gambling Platform
Despite the mainstream acceptance of sports betting, conservative voters and anti-gambling advocates continue to decry not only the legalization of mobile sports betting and iGaming but also the prediction platforms that offer essentially the same sports betting menu found at DraftKings, FanDuel, or any number of other mobile sportsbooks.
“This is public health. It rewires the brain, it requires increasing amounts of dopamine, people will bet more and more and more,” said Russ Coleman, board chair for Texans Against Gambling. “The number of suicides that will result, the number of families that will be broken up, the number of embezzlement cases — it will hit.”
Yet, public opinion polls suggest that a majority of Texans support legal sports betting. Governor Greg Abbott has offered mixed signals—at times expressing openness to expanded gambling, but then backtracking late last year, saying he has not fully embraced the idea of legal casinos or sportsbooks in the state.
“I’m not there yet,” Abbott said in a December interview with CBS News Texas. “I’m simply not there yet. Because we’ve seen an increasing number of problems that go along with gaming. Whether it be addiction or whether it be things that are happening in sporting events and athletes who are on the take. And so, there have been more red flags raised.
“That caused us to have to pause, step back, take a look at this, and make sure that we wouldn’t do anything that would be harmful, either to the people of the state of Texas, the culture that we have in the state, or to sporting events that we have in the state.”
However, even if Texas does enact a law prohibiting prediction markets from operating in the state, it will likely go unheeded by the likes of Kalshi and Polymarket, two of the prediction industry’s titans. They continue to operate under the protection of the federal authority of the CFTC, and now the agency is joining the fight against state gaming commissions and attorneys general issuing cease-and-desist orders.
Many believe the conflicting rulings by state and federal appeals courts will spur the US Supreme Court to hear the case over whether the state or the feds have jurisdictional authority over prediction markets offering sports event contracts. Regardless of how the legal landscape ultimately shifts, understanding how to gamble responsibly remains the most important factor for anyone choosing to participate in these markets.
