Connecticut Bill Would Bar Prediction Markets From Users Under 21
Connecticut Gov. Ned Lamont has proposed legislation restricting prediction markets by age and advertising, signaling increased state scrutiny of event contracts.
Connecticut Governor Ned Lamont has introduced legislation that would prohibit prediction market platforms from allowing users under 21 and from advertising to them, marking one of the most direct state-level efforts to regulate event-based trading markets.
The proposal, filed as HB 5038, would impose new restrictions on platforms that allow users to trade contracts tied to real-world events, including sports and political outcomes. The bill reflects growing concern among state officials that prediction markets increasingly resemble gambling products and may appeal to younger users.
If enacted, the measure would place prediction markets under rules similar to those governing sports betting and casino gaming in Connecticut.
What the Bill Would Do
Under HB 5038, prediction market operators would face explicit limitations tied to age access and marketing practices.
Key provisions include:
- Minimum age requirement of 21 to participate in prediction markets
- Prohibition on advertising or marketing prediction market products to individuals under 21
- Authority for state regulators to enforce compliance and impose penalties
The bill does not ban prediction markets outright, but it would sharply limit how platforms operate within the state.
Why Connecticut Is Taking Action
Governor Lamont’s proposal comes as prediction markets gain mainstream visibility, particularly through platforms offering contracts on high-profile sporting events.
State officials have expressed concern that:
- Event contracts closely resemble wagers
- Younger users may not distinguish trading from gambling
- Advertising could normalize speculative behavior among minors
Connecticut already enforces strict age and advertising rules for sports betting, which is limited to users 21 and older and subject to marketing restrictions. The governor’s office has framed the bill as an effort to ensure consistency across wagering-like products.
How Prediction Markets Differ — and Why That Matters
Prediction market platforms argue that they operate as financial exchanges rather than gambling operators, often pointing to federal oversight.
Many such platforms are regulated at the federal level by the Commodity Futures Trading Commission, which oversees derivatives and futures markets.
However, Connecticut’s bill signals that state officials may not accept federal regulation alone as sufficient when products resemble gambling activity within state borders.
The legislation reflects a broader debate over whether:
- Event contracts should be treated as financial instruments
- States retain authority to impose consumer protections
- Federal oversight preempts state gambling laws
HB 5038 does not attempt to resolve that debate directly but asserts state-level consumer protections regardless of federal classification.
Advertising Restrictions a Central Focus
In addition to age limits, the bill places particular emphasis on advertising practices.
Connecticut lawmakers have increasingly scrutinized gambling-related marketing, especially advertising that:
- Uses social media platforms popular with young users
- Mimics gaming or entertainment content
- Emphasizes quick rewards or low-risk participation
The proposed advertising restrictions would mirror existing rules applied to sportsbooks and casinos, reinforcing the state’s stance that products resembling gambling should be marketed responsibly.
Industry and Regulatory Implications
If enacted, HB 5038 could:
- Force prediction market platforms to geofence or restrict Connecticut users
- Require changes to marketing campaigns nationwide
- Encourage other states to consider similar legislation
Industry observers note that Connecticut is often an early mover on gaming policy, and its actions are closely watched by regulators in other jurisdictions.
The bill also adds to mounting pressure on prediction markets as states weigh how to respond to federally regulated platforms offering event-based contracts.
What Happens Next
HB 5038 has been introduced and referred to committee, where it will be reviewed, debated, and potentially amended.
Next steps include:
- Committee hearings and public testimony
- Possible revisions to bill language
- A vote in the Connecticut General Assembly
There is no guarantee the bill will pass, but its introduction alone signals heightened state scrutiny of prediction markets.
Why This Matters
As prediction markets grow more visible and accessible, states are increasingly questioning whether existing regulatory frameworks adequately protect consumers, particularly younger ones.
Connecticut’s proposal underscores a broader trend: states are no longer waiting on federal clarity before asserting their own rules.
Whether HB 5038 becomes law or not, it adds momentum to a national conversation about where prediction markets fit in the evolving landscape of gambling, finance, and consumer protection.
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