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Assembly Member Clyde Vanel has introduced Assembly Bill 9251, formally titled the Oversight and Regulation of Activity for Contracts Linked to Event Act, or ORACLE Act. The proposal has drawn attention because it seeks to regulate prediction markets in the state.
If passed, the bill would ban most event-based prediction markets in New York, including some sports markets. The move comes as major US sports betting operators are beginning to explore products modeled on prediction markets. Companies such as DraftKings have signaled plans to expand in this area.
Bill outlines major restrictions on event-based trading
The ORACLE Act would amend New York’s General Business Law and create a new section governing prediction markets. The bill establishes definitions and regulations for platforms that enable people to trade on future events. It states that users would no longer be able to open positions on the following:
- Catastrophic events
- Political outcomes
- Deaths
- Securities
- Athletic events
Athletic events can include trading on the outcome of a single game or on specific events within that game, and the bill explicitly mentions prop-style outcomes. However, it allows certain exceptions. Markets tied to the result of a tournament or series would still be permitted. Trading on which team will win the next NBA championship, as well as bracket-style markets for March Madness, would remain allowed.
The proposal has been submitted to the Assembly Committee on Consumer Affairs and Protection for review, marking the beginning of the legislative process and signaling the state’s intention to establish stronger regulations for prediction markets.
The bill also sets strict consumer protection rules for any platform that continues to operate in New York. Platforms must comply with the following conditions:
- Users must be 21 or older
- Trading platforms must provide responsible-trading tools
- Players must be able to set deposit, spending and time limits
- Platforms must offer self-exclusion and prominently display the state’s problem gambling helpline
The proposal bans credit card payments and bars platforms from sending push notifications that encourage activity. Advertising to people under 21 would be prohibited, and terms such as “risk-free” would not be allowed in ads. Operators must disclose how they settle markets. These measures align prediction markets with standards already used for licensed sportsbooks.
State vs. federal oversight creates regulatory tensions
The ORACLE Act would empower New York Attorney General Letitia James to request that courts issue orders against platforms that fail to comply with the rules. If a platform fails to respond to a request to stop its operations, it could face financial penalties. The bill imposes a fine of not more than $10,000 for a first violation and $50,000 for repeat offenders.
In worst-case scenarios, an online platform that fails to comply with a court order to go offline may be fined up to $1 billion per day. The bill also restricts liquidity providers involved in gaming activities, which are often associated with large sportsbooks.
Prediction market operators argue that their contracts fall under the jurisdiction of the Commodity Futures Trading Commission. Since the federal government does not see a need to review existing laws, it believes state gambling laws carry less weight. Platforms such as Kalshi have already taken legal action against several states after receiving cease-and-desist notices, claiming regulators are overstepping their authority. Critics say the New York bill could trigger new disputes over whether states or the federal government has the final say on event contract regulation.
The legislative session begins in January, when the bill’s future will be decided. Its progress will depend on political backing, including whether Sen. Joseph Addabbo Jr. supports it.
Industry growth drives legislative response
A likely motivation is the growing interest among sportsbooks in entering the prediction market space. DraftKings, for example, plans to launch its Predictions product, offering event contract markets in several states. Its push mirrors a broader trend as more operators experiment with prediction-style offerings.
DraftKings has also reported steady growth, with third-quarter 2025 revenue surpassing $1 billion, up 4% from the same period last year. These developments could explain why New York lawmakers are acting now. The state wants clearer rules before large operators expand further. The bill aims to protect consumers while maintaining control over products that sit between sports betting and trading.
Bill could reshape the future of prediction trading
If enacted, the bill would position New York to establish one of the most robust regulatory systems for prediction markets in the United States. Other states may follow its approach.
Enforcement may prompt platforms to withdraw from specific markets or limit activity while lawmakers debate the proposal. The industry is likely to face closer review as regulators consider how to classify and supervise these products, with responsible participation and consumer protection as the state’s stated goals.
