New York State Assembly faces a legislative proposal prohibiting various prediction markets. Assembly Bill 9251 covers sports outcomes, political events, and catastrophic incidents. Assembly Bill 9251 carries the name Oversight and Regulation of Activity for Contracts Linked to Events (ORACLE) Act. This legislation aims to define, regulate and restrict speculative market operations linked to future events.

The most important section bans several market categories for New York users explicitly. Prediction markets covering catastrophic events, politics, deaths, securities, and athletic events face prohibition. The ORACLE Act states that prediction market platforms cannot let New York users open speculative positions. These restrictions apply to specified market types. “Athletic events” means single sporting events or occurrences within those events specifically. Prediction markets about overall sports tournament winners remain permitted under the bill.

Age Restrictions and User Eligibility Rules

Consumer protection rules would apply to permitted platforms strictly. Age restrictions require users to be 21 years or older. Self-exclusion mechanisms and mandatory HOPE NY gambling hotline display have become requirements. Settlement source disclosure for outcome determination becomes mandatory for providers. Using proprietary or confidential data for contract settlements faces prohibition.

Advertising restrictions create another central law feature within proposed legislation. Marketing to individuals under 21 faces prohibition. Phrases like “risk-free” cannot appear in promotions. Push notifications promoting bonuses or markets without user positions face platform restrictions. Responsible gambling warnings must be displayed throughout the advertisement duration continuously. Credit card deposits and gift certificate sales linked to prediction markets face additional prohibition.

Sportsbooks Face Apparent Targeting in Bill

Prediction market providers cannot partner with liquidity providers engaging in gaming activities. Regular business operations involving gaming activities disqualify potential partners. This clause might prevent crossover between gambling operators and prediction market firms. DraftKings, FanDuel and others already prepare prediction market launches.

Substantial fines are put forth in the proposed legislation for transgressions. We see individuals’ violations, which may result in civil penalties up to $10,000. As for persistent misdoings, we see fines of $50,000 per violation. The Attorney General receives the power to seek injunctions shutting down non-compliant platforms. Continuing violations carry fines reaching $1 million per day, maximum.

The ORACLE Act attempts to separate prediction markets from regulated gambling and securities activities. Critics might consider its scope excessively broad, however. The Attorney General would implement enforcement measures balancing consumer protection with technological innovation if passed. Speculative digital markets require careful regulatory consideration. The General Assembly’s Standing Committee on Consumer Affairs and Protection currently reviews the bill.