Published on: March 28, 2026, 03:52h.
Updated on: March 28, 2026, 03:52h.
- Lt. Gov. Dan Patrick is calling for an examination of prediction markets in the Texas State Senate next year.
- Election-related contracts are highlighted in his list of legislative priorities.
- Currently, sports betting remains illegal in Texas.
The Texas State Senate is set to address prediction markets in some capacity during the 2027 legislative session, following a directive from Lt. Gov. Dan Patrick (R-TX).
In a recent briefing, Patrick outlined his priorities for the lawmakers in the upper chamber to consider ahead of the 2027 session. Among the eight matters he wishes the State Affairs Committee to deliberate is the goal of “closing gambling loopholes.”
“Investigate the rapid rise of prediction market gambling and the ways federal law is being leveraged to bypass Texas’s gambling restrictions by enabling bets on election outcomes and various events,” stated a document from Patrick’s office.
The lieutenant governor has instructed committee members to explore “the link between federally regulated derivative markets and state-prohibited gambling,” with the aim of producing recommendations to enhance the integrity of Texas elections and sports betting.
Texas: A Unique Case Study in Prediction Markets
While not as pronounced as in a few smaller states like Hawaii and Utah, Texas has a politically anti-gaming stance, with Patrick known for being among the staunchest opponents of gaming in the Lone Star state.
Las Vegas Sands is looking to establish a casino hotel in the Dallas-Fort Worth Metroplex, yet Patrick has continually obstructed efforts to present casino legislation in the Senate. Similar roadblocks have been in place for initiatives to legalize online sports betting in the nation’s second-largest state by population.
As sports betting is illegal in Texas, there are indications that prediction markets are starting to gain popularity, although the state has yet to see politicians or regulators closely scrutinizing yes/no exchanges.
While state lawmakers have not focused extensively on prediction markets thus far, Rep. Greg Casar (D-TX), representing the Austin area, has teamed up with Sen. Chris Murphy (D-CT) to propose the Banning Event Trading on Sensitive Operations and Federal Functions Act. Should it become law, the legislation would prohibit prediction markets from offering derivatives based on government actions, terrorism, warfare, and other events subject to influence by potential bettors.
California Taking a Firm Stance
Patrick’s call for Texas state senators coincided with an announcement from California Gov. Gavin Newsom (D), stating that state officials will be prohibited from profiting off insider information within prediction markets.
“This ban aims to extend these restrictions to stop appointees from utilizing insider knowledge to benefit others, including spouses, children, and business associates, from such information,” as noted in a statement.
Earlier this month, California lawmaker Mia Bonta (D-Alameda) introduced legislation to curtail advertising by sportsbooks and yes/no exchanges. Bonta is also the spouse of Attorney General Rob Bonta, who has received substantial campaign contributions from California tribal casino interests.