Sports prediction markets are becoming a popular option for online customers who crave real-time probability adjustments and the ability to manage their exposure as events evolve. But are sports prediction markets legal in the US?
The short answer is yes, sports prediction markets are legal in the US. But it is more nuanced than that. Many states and Native American tribes have sued the major prediction market operators, arguing that the “trades” available on their platforms are actually sports bets that are prohibited in their jurisdictions. That means that prediction markets are legal in the US for now, but things could change significantly in the future.
I’ll break down the legality of sports prediction markets in the US below.
Restricted states and key risks for players
With this said, there is one place where you can pretty much forget about legally participating in any type of online sports prediction market – the Evergreen state of Washington.
The hard-nosed enforcement mechanisms of the northwestern state mean that players themselves (not to mention operators) face a grim reality when it comes to anything that even loosely resembles “non-regulated” entities. Any company offering games of chance, including DFS, which the state considers a game of chance, is technically committing a felony in Washington. Yes, a felony! Needless to say, every online gaming operator has stayed far away from Washington.
Several other states have taken legal action against the top prediction market operators, and they have responded by shutting down in some of those states. But so far the operators are not going away and seem to be ready for an extended legal battle to maintain their nationwide reach.
Where can traders access sports prediction markets?
Right now Kalshi and the biggest operators are available in every US state. As mentioned, several states have sued to blocked the operators from doing business in their state, but for now those legal challenges are still pending and prediction markets operate in every state. This page will be update when/if any operators permanently withdraw from one or more states.
“Know Your Customer” and statewide residency
Another hiccup that some prospective players may run into is that you’ll need to actually reside in (as opposed to visiting as a tourist) whichever state you’re logging-on from… unless you never plan on making a withdrawal or prize claim.
All sports prediction market platforms, regardless of their business model and area of operation, require players to complete a “Know Your Customer” verification check before processing any outbound transaction.
This means that you’ll need to provide proof of address (not a P.O. Box) when submitting a recent utility or telephone bill to pass the KYC process.
Legal status of prediction markets by state
Below is a table outlining the legal status of prediction markets in every US state. Due to ongoing legal issues and lawsuits, keep in mind that the regulatory environment for sports prediction markets is likely to remain in flux throughout 2026 and beyond. Notice that many states with legal sports betting are suing the prediction market operators. This is mostly because the prediction markets are not subject to state regulation and, more importantly, do not pay any state taxes.
| State | Legal statewide online sports betting? | Active state or tribal legal challenges to prediction markets? |
| Alabama | No | No |
| Alaska | No | No |
| Arizona | Yes | No |
| Arkansas | Yes | No |
| California | No | Yes |
| Colorado | Yes | No |
| Connecticut | Yes | Yes |
| Delaware | Yes | No |
| Florida | Yes | No |
| Georgia | No | No |
| Hawaii | No | No |
| Idaho | No | No |
| Illinois | Yes | Yes |
| Indiana | Yes | No |
| Iowa | Yes | No |
| Kansas | Yes | No |
| Kentucky | Yes | Yes |
| Louisiana | Yes | No |
| Maine | Yes | No |
| Maryland | Yes | Yes |
| Massachusetts | Yes | Yes |
| Michigan | Yes | Yes |
| Minnesota | No | No |
| Mississippi | No | No |
| Missouri | Yes | No |
| Montana | No | No |
| Nebraska | No | No |
| Nevada | Yes | No |
| New Hampshire | Yes | No |
| New Jersey | Yes | No |
| New Mexico | No | No |
| New York | Yes | Yes |
| North Carolina | Yes | No |
| North Dakota | No | No |
| Ohio | Yes | No |
| Oklahoma | No | No |
| Oregon | Yes | No |
| Pennsylvania | Yes | No |
| Rhode Island | Yes | No |
| South Carolina | No | No |
| South Dakota | No | No |
| Tennessee | Yes | Yes |
| Texas | No | No |
| Utah | No | No |
| Vermont | Yes | No |
| Virginia | Yes | No |
| Washington | No | Yes |
| Washington DC | Yes | No |
| West Virginia | Yes | No |
| Wisconsin | No | No |
| Wyoming | Yes | No |
What are sports prediction markets?
Sports prediction markets are roughly defined as “Yes/No” selections on every sport and wager type that one might find on a traditional internet sportsbook app.
The difference is that traders can buy and sell individual contracts of their selections in real time – either before the event occurs or while the game is in progress.
For more on sports prediction markets, check out some of our InGame guides on the subject.
- Prediction market liquidity
- Prediction market fees
- Prediction market glossary
- Prediction market responsible gambling
- Prediction markets explained
Sports prediction contract vs. a sportsbook bet
If you place a moneyline bet with a sportsbook that your NFL team will win their next game at -200, then you can expect to win $100 for every $200 you wager if your bet settles as a winner.
The odds will not change for the bet you placed, even if the game is currently in the 4th Quarter with less than a minute to go and your team is winning or losing by 30 points.
However, if you buy 100 individual sports prediction contracts, at approximately 67 cents each, you can sell them (or buy them from other players) whenever the odds fluctuate – even during the game.
Of course, this means you’ll need to find a buyer or seller (typically another player on the platform) who agrees to the price you want, but sports market predictions thrive on the ability to trade at modified prices.
Conclusion: sports prediction markets and their legality in the US
Currently, there are just a handful of states that have gone “all-in” on trying to restrict popular sports prediction market apps such as Kalshi.
But the number of states that are, at the very least, taking a look at seriously challenging sports prediction market sites and apps has increased substantially over the past year.
In the long run, it is likely to take several years for the legal landscape of sports prediction markets to establish itself on a statewide basis. In the meantime, enjoy the prediction market apps available in your state and remember to trade responsibly.
