New York lawmakers will continue to work in 2026 to pass a bill that would restrict certain prediction markets while adding consumer protection requirements for platforms operating in the state.
New York Assembly Bill A9251, also known as the ORACLE Act (Oversight and Regulation of Activity for Contracts Linked to Events), was re-referred to the Assembly Committee on Consumer Affairs and Protection on Jan. 7, restarting its review for the current legislative session.
The ORACLE Act represents one of the first state legislative efforts in the U.S. specifically drafted to restrict and regulate prediction markets through statute, rather than relying on existing gambling or regulatory enforcement frameworks, making it a potentially precedent-setting move. The bill proposes some of the strictest state-level limits to date, targeting not only sports event contracts (the focus of most prior state actions against prediction markets), but also certain political and election-related markets and contracts related to natural disasters and death.
The bill was first introduced by assemblymember Clyde Vanel in November of last year. In an interview with DeFi Rate, Vanel explained the intent of the ORACLE Act, which would amend the New York General Business Law by adding a new article establishing state‑level rules and restrictions for prediction markets.
“We want to make sure that Wall Street stays on Wall Street and Vegas stays in Vegas,” Vanel said. “We’re very concerned that investment activities are being meshed and commingled with what we think is wagering activity…When people are investing they’re investing, and when they’re wagering, that’s something else.”
What the ORACLE act would restrict, require
If the ORACLE Act were to pass as is, prediction platforms would be barred from offering in New York trading on contracts tied to several categories:
- Athletic event contracts based on individual games, plays, or player performances, including prop-style markets (markets for tournament outcomes would still be permitted)
- Political markets, including elections or specific government actions
- Catastrophic event markets, such as natural disasters or mass casualty incidents
- Death markets, including contracts tied to specific or mass deaths
- Securities markets, meaning prediction contracts based on the price movement or performance of publicly traded companies
Some of these categories, particularly catastrophic events and death markets, are already effectively restricted under federal law. The Commodity Exchange Act (CEA) gives the Commodity Futures Trading Commission (CFTC) authority to block event contracts tied to disasters, terrorism, or deaths.
The ORACLE Act also includes a set of consumer protection measures intended to reduce risks associated with event contract trading, including:
- Self-exclusion tools: Platforms would be required to allow users to voluntarily restrict or pause their own access to trading.
- Risk disclosures and responsible gaming notices: Platforms must clearly display information warning users about the speculative nature of event contracts and must post the NYS HOPEline, a problem gambling hotline.
- Advertising restrictions: Marketing to minors or users who have self-excluded would be prohibited.
- Limits on credit use: The bill would restrict the use of credit cards or other credit-based funding.
- Age minimum: The bill requires prediction market platforms to restrict participation to users who are at least 21 years old.
Violations of the ORACLE Act would be enforced by the New York State Attorney General, with civil penalties of up to $10,000 per violation, increasing to $50,000 per violation for a persistent course of misconduct. Some violations could result in a fine equal to either twice the money made from the violation or $50,000, whichever is higher. A platform that continues to operate after a court injunction could face $1 million per day in additional penalties.
Sports markets are betting “in an event contract wrapper”
The “Justification” section of the bill’s memo submitted with the Assembly text begins with a statement alleging that prediction markets are essentially a form of gambling in disguise.
“Like the pre-flipper pinball machines, sweepstakes cafes, sweepstakes gambling, and many other schemes that preceded it, prediction markets have rebranded old-fashioned wagering as ‘trading,’ inviting the public to buy and sell positions on real-world events with an expected payoff,” the justification reads. “Yet whatever wrapper prediction markets are placed in does not change the substance. The constant throughline throughout history is simple: when a product hits the three classic elements — consideration, prize, and chance — states can treat it as gambling regardless of the label. Prediction markets are the latest wrapper.”
Vanel used similar language when asked about the prohibition of sports event contracts, which have overwhelmingly accounted for the majority of trading volume at leading U.S. platform Kalshi. Like many of the state-level cease-and-desist orders issued against platforms for their sports contracts, Vanel said that those markets are essentially sports bets, which are offered through sportsbooks that are licensed and regulated by the New York State Gaming Commission. Several platforms, including Kalshi and Crypto.com, have challenged the cease-and-desists in court, arguing that federal regulation by the CFTC preempts state law.
“We want to prohibit these prediction markets from providing markets and activity that are (regulated) by the state,” Vanel said. “So, think about sports (contracts) … these are activities that are betting. It is not a prediction market. That’s gambling. So you can not provide that kind of contract in New York state, wrap it in an ‘event contract’ (wrapper) and call it ‘an investment.’ It’s not; it’s gambling.”
Limits on political and election contracts
One area that the ORACLE Act differs from other states’ actions against prediction market exchanges is the proposed ban on several non-sports markets, including many political event contracts. Election prediction markets have been important to platforms, both for trading volume and visibility, attracting widespread attention from mainstream media outlets. Kalshi has a partnership with CNN that has led to Kalshi probabilities being worked into news broadcasts.
The ORACLE Act extends to limits on contracts related to federal elections, as well as statewide and local contests in New York. It goes further by proposing limitations on contracts related to “the actions or conduct” of federal, state and local governments, including its agencies, officers, employees, and leaders. That would mean that not only would New Yorkers not be able to trade on the outcome of things like the 2028 U.S. presidential election or the next NYC mayoral election, but also, theoretically, Trump’s impeachment chances, whether there will be another government shutdown, or even whether the U.S. government will confirm that aliens exist by a certain date.
Vanel said restricting these political markets is all about helping to sustain the public’s trust in the system.
“We feel it is wrong to be able to put up event contracts for (elections and politics),” he said. “It will erode the public’s confidence in government, at the very least, and who knows what can happen at the very worst.”
The justification text in the bill’s memo says that these political contracts are “flatly contrary to public policy.”
“Wagers on elections commoditize public office, incentivize misconduct, and corrode confidence in democratic outcomes,” the memo says.
Too early to gauge odds of ORACLE Act passage
Vanel said it was too early for him to determine the likelihood of the ORACLE Act passing both chambers and reaching governor Kathy Hochul’s desk (“The ink on the bill is still wet,” he said). He doesn’t yet have a good sense of support or opposition among his fellow Assembly members, but Vanel did say that “there’s a lot of interest in talking about prediction markets, a lot of folks want to talk about it.”
The ORACLE Act is still in search of a Senate sponsor so that a Senate companion bill can be introduced. Vanel said Senator Joseph Addabbo Jr., chair of the Senate’s Racing, Gaming & Wagering Committee, “will most likely carry it, but we’re working on that.” Shortly after the bill was introduced last year, Addabbo told DeFi Rate that he was asking legal counsel to examine the bill.
“If we feel it’s something that’s a) within our jurisdiction and b) it would matter — like it would make some sense to do — I’ll talk to my friend (Vanel) to see if I can carry it in the Senate,” Addabbo said.
Although his ambitious bill would severely restrict what New York residents could trade on at prediction market platforms, Vanel indicated that he appreciates the concept of event contract trading.
“We’re excited about the new opportunity and the opportunity that prediction markets provide, with getting more people involved in financial markets,” Vanel said. “But we want to keep Wall Street and Vegas in their respective places.”
