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Hawaii lawmakers have introduced a bill that would treat online prediction markets as illegal gambling in the state, after nearly $449,000 was wagered on whether Gov. Josh Green would say specific words during his State of the State address.
The proposal, House Bill 2198, comes from state Rep. Scot Matayoshi and takes a direct approach to rewrite Hawaii’s definition of “gambling” to explicitly include buying, selling, or speculating on event-based contracts tied to real-world outcomes.
If passed, Prediction market categories would be barred from the state
In plain terms, the bill tries to shut the door on platforms that let users trade “yes/no” contracts on outcomes that look and feel like bets. The bill lists categories that would be covered, including sports outcomes, contests and promotions, events involving people, political actions and elections, catastrophes like disasters or public health crises, and even death-related outcomes.
If HB 2198 passes, it would add prediction markets to the list of things the state does not want operating under a legal technicality. The bill text argues that these products create financial incentives around sensitive events and exploit a gap in existing gambling law that carved out certain contracts tied to securities and commodities.
Where the bill stands right now
HB 2198 was introduced in late January and referred to House committees, including Consumer Protection and Commerce and Judiciary, according to the bill tracking. It also sets a proposed effective date of July 1, 2026.
Prediction market fight spreading beyond Hawaii
Hawaii is not alone in doubting if these products are “event contracts” finance, or are they betting with a new label?
State regulators elsewhere have already started testing that question in court. In Massachusetts, a judge ruled that Kalshi could not offer sports-related contracts to residents without the proper state authorization, rejecting the argument that federal commodities oversight automatically blocks state gambling rules.
Even the NFL is treating prediction markets as a different kind of risk. Multiple reports say the league blocked prediction-market ads from running during the Super Bowl broadcast this year.
Source: Gaming America
