Tennessee lawmakers are pushing forward with laws that will make it a felony to attempt to sway the end result of occasions tied to prediction market conduct when cash is on the road.
The state Senate signed off on Senate Bill 1992 on Thursday (April 9), backing the proposal 28-1 after first adopting an modification earlier within the day. The measure mirrors House Bill 2079 and now strikes ahead as a part of a wider effort to control rising on-line buying and selling platforms constructed round future occasions.
The invoice creates a brand new legal cost geared toward individuals who try to affect outcomes whereas financially invested in them by way of prediction market contracts.
New legal offense targets prediction market conduct in Tennessee
Below the proposal, somebody would break the legislation in the event that they take steps to have an effect on the results of an occasion whereas they, or somebody working with them, holds a place in a associated prediction market. The important thing situation is monetary profit, whether or not direct or oblique.
The invoice states that an individual violates the legislation by taking such motion “whereas the particular person or one other is a celebration to a contract with a prediction-market by which the particular person will profit, straight or not directly, from the prevalence of the end result.”
If convicted, the offense can be handled as a Class E felony in Tennessee.
Lawmakers additionally lay out a basic definition of prediction markets, describing them as “a platform on which people commerce contracts primarily based on the end result of unknown future occasions.” This leaves the legislation open to overlaying every thing from political outcomes to sports activities and different speculative markets.
The push comes because the Volunteer State is already locked in authorized disputes with a number of prediction market operators. The state beforehand issued cease-and-desist letters to companies including Kalshi, Polymarket, and Crypto.com, arguing their choices violated state legislation.
It has confronted resistance in court docket. A federal judge recently blocked Tennessee from imposing restrictions towards Kalshi’s sports-related contracts, and the corporate additionally secured a temporary restraining order towards the state’s actions. The rulings have added uncertainty round how far Tennessee can go in policing these platforms.
Even so, the brand new laws takes a distinct angle by specializing in particular person habits moderately than platform legality. By putting the offense inside Title 39, which covers property-related crimes, lawmakers are framing manipulation tied to monetary acquire as a type of financial wrongdoing.
If it finally turns into legislation, the measure would take impact July 1, 2026.
Featured picture: Kenneth C. Zirkel by way of WikiCommons / CC BY-SA 4.0
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