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A New Jersey state senator has introduced a bill that could block prediction market platforms from operating in the state. State Sen. Shirley K. Turner, D-Mercer, filed legislation last week to prohibit certain prediction markets.
Bill S3692 seeks to ban specific operations while exempting athletic event markets that comply with existing sports betting regulations. The proposal also calls for a public awareness campaign, according to the original news story by PlayNJ.
Closing the financial contract betting loophole
Even without full details, it is clear that prediction platforms are in the crosshairs of New Jersey lawmakers. Although the bill does not specify which markets would be prohibited, industry experts expect sports-related contracts to be the primary target.
Prediction markets have become a national flashpoint, especially as platforms like Kalshi have expanded into sports event contracts that mirror traditional sportsbooks. The key distinction is that prediction platforms structure their offerings as financial contracts rather than wagers. New Jersey regulators argue this allows operators to sidestep the state’s gambling laws—rules that licensed sportsbooks must strictly follow.
The high-stakes battle with Kalshi
The state is already locked in a legal battle with Kalshi. The company began offering sports-related contracts around the 2025 Super Bowl and has since rolled out a full slate of markets covering major leagues and events. While the company operates under federal oversight from the Commodity Futures Trading Commission (CFTC), New Jersey’s Division of Gaming Enforcement (DGE) maintains those products fall under state sports betting regulations.
Last March, the DGE issued a cease-and-desist letter to Kalshi. A New Jersey judge later granted Kalshi a preliminary injunction, allowing it to continue operating while the case proceeds. The DGE appealed that decision in June. Attorney General Jennifer Davenport has cited a Massachusetts court ruling from earlier this year that blocked Kalshi from offering sports markets in that state.
New crackdown on college sports wagering ties
Turner introduced a second bill, S3656, last week as well. That proposal would prohibit colleges and universities from entering into sports wagering partnerships. New Jersey lawmakers have floated several gambling-related education bills in recent years; however, former Gov. Phil Murphy signed legislation expanding gambling addiction education programs at public colleges before leaving office.
The future of event trading in New Jersey
Until the full bill language is published, it remains unclear how broad Turner’s proposal will be or how it might affect the ongoing court battle. What is certain is that New Jersey is maintaining an aggressive stance against prediction markets, particularly those offering sports contracts.
As more states weigh similar measures, a fundamental question remains: Are prediction markets financial exchanges under federal jurisdiction, or are they simply sportsbooks operating under a different label? New Jersey appears ready to answer that question through the Legislature rather than waiting for the courts.
