Texas weighs tightening prediction-market rules as federal oversight looms

Texas Lt. Gov. Dan Patrick directed lawmakers to explore closing so-called gambling loopholes that allow online prediction markets (Kalshi, Polymarket) to operate in Texas, amid fears of manipulation of elections and sports outcomes. However, any state move faces federal resistance since the CFTC claims exclusive authority and has sued states attempting to regulate these markets. The story details a growing clash between state efforts and federal preemption, with Kalshi enforcing penalties on candidates who bet on their own races and opponents warning of gambling harms, while supporters push for robust federal regulation and consumer protections. Texas has been slow to act, and Patrick’s push for 2027 recommendations leaves the issue in limbo as courts and Congress weigh tighter controls over prediction markets. Meanwhile, traditional sportsbooks like DraftKings and FanDuel have rolled out related prediction-market features in Texas, underscoring a broader national debate over governance and oversight.