Ohio Warns Sportsbooks: Prediction Market Partnerships Could Jeopardize Licenses
The Ohio Casino Control Commission (OCCC) has issued a direct warning to its licensed sports betting operators: any involvement with sports-based prediction markets could put their state licenses at risk. The formal letter draws a clear line in the sand, explicitly defining these emerging products as a form of illegal online sports gaming in the state.
A Clear Legal Stance
In its letter to licensees obtained by Event Horizon, the OCCC left no room for ambiguity. The commission stated that offering “event contracts” on sporting events to Ohio residents constitutes unlicensed sports gaming and is a violation of state law.
“Plainly stated, companies that are offering sporting event contracts are operating online sports gaming,” the letter reads. “Sports gaming cannot be offered in Ohio without a license issued by the Commission.”
The warning is not just theoretical. The OCCC made it clear that it will scrutinize any operator’s decision to enter the prediction market space when evaluating its “continued suitability” to hold a license in Ohio.
Guilt by Association: Partnerships Under Fire
The commission’s warning extends beyond operators who might launch their own prediction market platforms. It specifically targets partnerships with existing prediction market companies, a direct nod to recent high-profile deals like FanDuel’s partnership with CME Group and DraftKings’ exploration of the space.
The OCCC stated that any business relationship with a company offering what it considers illegal sports gaming in Ohio “calls into question the reputation of the licensee and the integrity of sports gaming in Ohio.” The commission warned it “may take administrative action against any licensee that does.”
Furthermore, the OCCC preemptively closed a potential loophole. The letter clarifies that even if an operator geofences Ohio residents out of its prediction market offerings, the partnership itself could still be grounds for a suitability review. This means simply blocking Ohioans from a national platform “may not alleviate the suitability concern.”
A History of Proactive Regulation
This firm stance is consistent with the OCCC’s track record as one of the nation’s most assertive gaming regulators. The commission has previously taken a hard line on issues it perceives as threats to market integrity or consumer protection.
Ohio was one of seven states to issue cease-and-desist orders to the prediction market platform Kalshi over its sports-related contracts. The OCCC has also issued similar orders to Robinhood and Crypto.com. This history suggests the commission’s current warning carries significant weight.
The letter makes a clear distinction, noting that the OCCC does not object to partnerships on financial prediction markets, as long as they do not involve sporting events. The focus is squarely on protecting the state-regulated sports gaming ecosystem from what it views as an unregulated parallel market. The move places the onus directly on licensed operators to choose between their state-level gaming licenses and their potential ambitions in the federally regulated prediction market space.
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