Digital Wager Wire highlights the most significant events affecting the domestic and international sports betting and gaming industries each week throughout the year.
Is “Minnesota Nice” for Sports Betting?
When we hear the term “Minnesota Nice,” we often envision the affable, helpful, and friendly residents of the North Star State willing to lend a hand to a complete stranger. But when it comes to passing sports betting legislation, the reception has been chilly, to say the least.
Bringing mobile sports betting to the Minnesota masses has been futile, but a recent piece of legislation, S.F. 4139, has bipartisan support, and there could be enough momentum to succeed where all others have failed.
The two main sponsors of the bill, DFL Senator Nick Frentz and Republican Sen. Jeremy Miller, have both been down this road before, but now their bill sits in the Senate Commerce and Consumer Protection Committee and the Rules and Administration Committee.
Minnesota Tribes Would Control Online Licenses
Under the measure, the Minnesota Commissioner of Public Safety would oversee the industry, and up to 11 online sports betting licenses would be granted exclusively to the state’s Native American tribes, with each one allowed to partner with one third-party sports betting platform.
Licensing fees are modest, and the state would tax net revenues at 22%, with half of the proceeds earmarked for offsetting taxes on charitable gambling revenue like the popular pull-tabs that are frequently found throughout the state.
Non-gaming tribes, the horse racing industry, and efforts to support bringing major sporting events to Minnesota would each receive 15% of the collected tax revenue. Responsible gambling resources would receive 4%, while sports integrity programs would be awarded 1% annually.
Splitting the money amongst several interested parties increases the likelihood of passage, but a litany of the state’s other more pressing issues may postpone a decision until next session.
End Prediction Market Corruption Act
Prediction platforms have been under fire by state gaming commissions for offering sports event contracts, which has seen their tax revenues on mobile sportsbooks slowly eroded. The prediction markets contend they are governed by the federal authority of the Commodity Futures Trading Commission (CFTC), which allows them to operate unfettered—and immune to state tax—in all 50 states.
That legal war is currently being waged with only a US Supreme Court decision likely to put an end to the debate once and for all. That remedy, if it does indeed occur, remains a few years away, but in the meantime, there is another issue concerning prediction platforms that concerns insider trading on real-world events by politicians and government officials.
Insider Trading Fears Grow Around Contracts
Unnamed users have profited off the raid on Venezuela and the attack on Iran, which could be the direct result of inside information that is translated into making big money on the contracts being offered by the likes of Kalshi and Polymarket, two industry leaders.
Bill Would Ban Officials From Trading
The End Prediction Market Corruption Act, a bill introduced by Democratic Senators Jeff Merkley and Amy Klobuchar, would prohibit members of Congress, the president, vice president, and senior executive branch officials from trading on prediction markets related to geopolitical events or other issues where access to non-public information could provide them with a financial advantage.
“When public officials use nonpublic information to win a bet, you have the perfect recipe to undermine the public’s belief that government officials are working for the public good, not for their own personal profits,” Senator Merkley said in a statement announcing the bill last week.
Whether this will pass muster with an administration that has the president’s son, Donald Trump Jr., acting as a strategic advisor for two industry leaders is dubious at best.
