Hawaii lawmakers are advancing legislation that would classify prediction markets as illegal gambling under state law. On Thursday, the House Commerce-Consumer Protection Committee voted unanimously by voice to move forward an amended version of House Bill 2198. The bill seeks to ban prediction markets in the state, where all forms of gambling are currently prohibited.
The hearing featured testimony from four opponents of prediction markets. No representatives from any platform testified in person or via video, and no one testified in favor of allowing the platforms. If enacted, HB 2198 would make Hawaii the first U.S. state to advance such a ban through the legislative process.
The hearing came amid national scrutiny of prediction markets. Kalshi, a prominent prediction market operator, is currently involved in legal challenges concerning its right to operate. Three federal judges have ruled that prediction markets should not be allowed until relevant court cases are resolved.
Regulatory warnings have also been issued in several states, urging licensed sports betting operators to avoid engaging with prediction markets. A draft federal bill would prohibit insider trading on prediction markets by government employees, while Connecticut’s governor has proposed raising the minimum age for participation to 21.
Testimony during the Hawaii committee hearing drew parallels between prediction markets and gambling. “Call it what you want, it’s still gambling… And millions of dollars are being lost on this bet!” one speaker said. Prosecutor Steve Alm stated, “Gambling by another name … this has the potential to destroy sports and destroy young men and women.”
Les Bernal, a longtime opponent of gambling, testified that the financial stakes are significant. “How do we make Hawaii more affordable for everyday citizens? This is an issue with citizens losing $300,000 a minute on the mainland and over the next five years, a trillion dollars of lost personal wealth to this institution.”
Representing Stop Predatory Gambling Now, Les Bernal described prediction markets as “a blatant attempt to avoid Hawaii’s laws on legalized gambling,” and said they have “metastasized across the U.S.”
The committee also accepted three amendments. Two were introduced by former Hawaii state Representative Marcus Oshiro, one relating to the legislature and another involving national security. A third amendment from the committee chair ensures the bill will not be repealed in 2029. According to the committee, none of the amendments alter the bill’s overall intent.
In his testimony, Oshiro noted that “about 90% of their revenue” for pure prediction markets such as Kalshi comes from sports event contracts. “Call it what you will, it’s betting,” he said.
The issue has surfaced as the Hawaii legislature begins its 2026 session. During the previous session, lawmakers nearly passed legislation to legalize sports betting, but it ultimately failed. Three bills from 2025 remain active: two aiming to legalize online sports betting and another proposing an entertainment district with casinos near Aloha Stadium.
Hawaii’s crossover deadline is set for March 12, and the session is scheduled to adjourn on May 8. HB 2198 is currently the only bill positioned to ban prediction markets. There is no companion bill in the Senate, and the deadline to introduce new bills has already passed.
Original article: https://www.yogonet.com/international/news/2026/02/09/117500-hawaii-house-committee-advances-bill-to-ban-prediction-markets
