We Were Making Great Time
Fast-moving online gambling legalization bills have run into legislative gridlock, and the longer these bills get dragged out, the more persuasive opposition will be.
The Bulletin Board
THE LEDE: Online gambling bills are stalling; will they get a jumpstart?
NEWS: Online helps gaming revenue reach new heights in 2025.
VIEWS: Vermont lawmakers propose per-wager sports betting fee.
AROUND the WATERCOOLER: The hubbub over the Khamenei market.
STRAY THOUGHTS: More prediction market news (it will never end).
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The Lede: Is 2026 Really Online Gambling’s Year?
The early momentum on the legislative front (sparked by Maine joining the ranks of online casino states) has run into the usual legislative morass in several states.
Below is a quick rundown of where each state stands. For deeper dives you can subscribe to The Forecast Tier.
ONLINE CASINO
VIRGINIA
Virginia is the big unknown. A pair of fast-moving online casino bills look to have an excellent chance to pass the legislature, but there are two potential sticking points:
Will Gov. Abigail Spanberger sign off on the bill?
Both bills now contain a reauthorization clause, requiring a second vote next year.
Previous coverage of Virginia’s online casino efforts can be found here.
HAWAII
Hawaii’s online casino bills (carried over from 2025), SB 1507 and HB 1434, were not referred to the House Finance or Senate Ways and Means Committees before a critical legislative deadline, pretty much ending any possibility they will be discussed further in 2026 — the legislative session officially ends on May 8. As STTP has noted, a working group to study gambling legalization options is required to issue a report due before the 2027 session, which makes expansion efforts even more unlikely.
There are also still-developing online casino efforts in Illinois, Massachusetts, New York, and Maryland to keep an eye on.
SPORTS BETTING
ALABAMA
SB 257, introduced in February by Sen. Merika Coleman would authorize mobile sports betting (as well as casinos and lottery) via a constitutional amendment. It is currently pending in its original committee, the Senate Tourism Committee, with no committee hearings, votes, amendments, or further actions reported.
ALASKA
A 2025 bill, HB 145, is still alive (and picked up a cosponsor earlier this year) but has remained largely untouched since it was introduced.
GEORGIA
Georgia sports betting legalization bills, HB 910 and SR 131, are alive, but lack anything resembling momentum as both bills (carried over from 2025) seem unlikely to get much attention over the next month, as the Georgia legislative session is scheduled to end in late-March/early-April.
MINNESOTA
Minnesota efforts are active, but the hurdles (tribes vs racetracks) that have thwarted previous efforts remain in place. The state has numerous bills to choose from, as 2025 efforts carry over to 2026, but Minnesota’s push to legalize mobile sports betting continues but shows little momentum, with recent legislative efforts failing to advance in the ongoing 2026 session.
MISSISSIPPI
The Mississippi House has passed two bills, both authored by Rep. Casey Eure. The newest bill, HB 4074, tries to overcome some of the opposition to mobile betting, with a 22% tax rate (rather than a graduated rate) and in an attempt to garner more land-based casino support, it lowers the tax rate on land-based casinos from 8% to 6%.
NEBRASKA
Nebraska is taking the Missouri approach, with a citizen-led ballot initiative receiving approval for circulation.
OKLAHOMA
Several sports betting legalization bills, primarily through tribal compacts, were carried over from 2025, but progress remains slow due to disputes between Gov. Kevin Stitt, tribal leaders, and lawmakers over exclusivity and market access.
SOUTH CAROLINA
Don’t expect anything to happen in 2026. Per local reporting: “Senators say lawmakers likely won’t pass any sports betting bill this year, but next year could be different because of prediction markets.”
SOUTH DAKOTA
SJR 504, a bill that would put mobile sports betting on the ballot has stalled in the South Dakota House State Affairs Committee, which rejected SJR 504 in a 7-6 vote. The bill was then deferred until the final day of the South Dakota legislative session, March 30.
WISCONSIN
Wisconsin looked promising after, AB 601 was unanimously passed in a voice vote in the Assembly on February 19, 2026. Senate passage is proving more difficult, as tension between tribes and commercial operators has sidetracked a tribal-backed bill that would give the state’s gaming tribes complete control over the industry.
News: Despite Headwinds, Gaming Revenue Reaches New Heights
Per the American Gaming Association, “The U.S. commercial gaming industry reached a record high in 2025, generating $78.72 billion in gross gaming revenue (GGR), a 9.2% increase over the previous year.”
Where is the growth coming from? It’s been largely online:
Traditional Gaming generated $50.94 billion in revenue, up 2.3%, while contributing $11.33 billion in taxes.
Sports Betting revenue rose to $16.96 billion, a 22.8% increase. State-regulated sportsbooks generated $3.71 billion in taxes.
iGaming reached $10.74 billion in revenue, a 27.6% increase, and delivered $2.59 billion in taxes.
Gaming accounts for 1.8 million jobs and $53 billion in total tax revenue.
As Miller said during the trade group’s recent State of States webinar: “All industry verticals set records in 2025, and we saw strong success across commercial and tribal gaming. Brick-and-mortar operations showed continued strength, while iGaming continued its strong performance.”
The webinar also featured Chris Christie, who called prediction markets “rogue cowboys,” before making the public case against prediction markets:
“Everyone knows what it is. It is a bet on a game and it’s not a commodity. It’s not something that is even in their ballpark to regulate. These prediction markets are putting it out there in a way that twists what the CFTC really is supposed to be doing. And it makes no sense. I think the public, if they understood it, would not see that as a commodity.
“What these prediction markets are doing is going into the 40 states where there’s a regulatory scheme and saying we’re not going to comply and we’re not going to pay taxes, we’re just going to do what we want to do. And in the 10 states who say we don’t want regulated casino gaming, too bad, we’re going to bring it anyway. It’s disrespectful of all 50 states. It violates the laws of all 50 states.
“And I think that over the course of time, either the courts or our political institutions are going to say this is not what we bargained for.”
You can also listen to my recent podcast episode with AGA President and CEO Bill Miller for his thoughts on prediction markets and the overall health of the gaming industry.
News: Vermont Bill Adds a Per-Wager Fee to Sports Bets
A new bill in Vermont aimed at prohibiting prediction markets would also impose an Illinois-like per-wager fee to sports bets placed in the state. H 913 would prohibit event contracts on sports, politics, people, disasters, war, and death.
More interestingly, since a state’s ability to prohibit prediction markets is the crux of the legal cases moving through courts, the bill would add a $.50 per-wager fee to sports bets.
The draft simply reads:
“This bill also proposes to amend Vermont’s sports wagering statutes to add a per-wager fee of $0.50 for all wagers made through the State’s sports wagering operators.”
Michigan Gov. Gretchen Whitmer’s budget also includes a per-wager fee, as well as other financial burdens:
Adding an Illinois-like per-wager fee of $.25 per bet on the first 20 million wagers, and $.50 on every bet thereafter.
Eliminating promotional deduction for sportsbooks.
Increasing the marginal tax rate on online casino revenue in the above $185 million bracket from 28% to 36%.
And in Arizona, we have one of the zaniest proposals of all time, as Gov. Katie Hobbs’ budget would impose a 45% tax on handle (yes, handle) on top operators through a new tiered tax structure:
“For operators with less than $75 million in average monthly revenue, the current fee of 10% (8% for retail) would still apply. For operators with more than $75 million in average monthly revenue, the fee would increase to 45%.”
The handle tax is likely a misunderstanding of how sports betting numbers are tallied, but as I said on X:
There are also potential tax increases on the table in two other states:
Massachusetts: SD 302, a comprehensive reform bill that includes a tax rate increase to 51%, was filed in February 2025, and recently had its reporting date extended to March 6, 2026.
West Virginia: HB 4397 (online casino) and HB 4398 (sports betting) would increase the online sports betting (10%) and online casino (15%) tax rates to 25%.
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Around the Watercooler
Social media conversations, rumors, and gossip.
Some kids are attention-starved, and in their eyes, any attention is good attention — we see it all the time at the karate school. They eventually learn that is not the case. Well, not all of them.
Prediction markets have a similar (give me attention!) mindset. Nothing is off-limits and no actions are too bold.
And as I’ve previously warned, that could cost them the narrative battle.
Their quest for legitimacy, and to become too big to put the toothpaste back in the tube, has led to a number of unforced errors, none bigger than the recent kerfuffle over the Ayatollah Khamenei market.
Put it this way, you don’t want CBS News doing segments on your missteps, when that will be the general public’s first introduction to you.
There are signs that prediction markets are (slowly) learning the same lesson.
Kalshi is also more prominently displaying the rule, as Barron’s Nick Devor reports, “Kalshi users previously needed to click through an additional screen to read the full rules of any given contract. New disclaimer language now appears directly underneath certain trades.”
And speaking to Barron’s, Kalshi cofounder Luana Lopes Lara said: “The main lesson we got from this weekend is that we need to do a better job explaining our rules to our users, and that kind of interaction with the rules before they place the trade.”
However, it’s not simply the clarity of the rules that people find troubling:
Stray Thoughts
Tomorrow’s newsletter will cover two more significant prediction market stories:
CFTC Chair Michael Selig saying (again) that rules are coming for prediction markets:
Michigan taking a page out of the Massachusetts playbook and preemptively suing Kalshi in state court.
