Is California Next To Ban Prediction Market Ads?

State after state across the United States has tried to ban prediction markets like Kalshi and Polymarket. And none of them have succeeded so far.

But there’s a new way to stop prediction markets’ rapid growth — curb advertising for them. That’s a new lifeline five states have just gotten, and we’re wondering when California joins the mix. It feels like a matter of when, not if.

You see, California betting is supposed to be tribal-led — a compact gives them exclusive rights to offer legal betting. However, prediction markets freely work inside them, anywhere and everywhere in the state. 49ers, Rams, Lakers “ sports contracts” can readily be found on these prediction sites inside the state.

So far, the Golden State hasn’t had luck stopping these prediction markets, which makes this next action all the more likely. Keep reading and we’ll explain what’s the newest threat to Kalshi and the like.

Google Blocks Prediction Market Ads In Five States

Google is still a major player in online discovery. Even with the rise of AI chatbots, many still punch into Google what they’re looking for first — including betting. That’s why this story has far-reaching potential. As of this month, Google is no longer allowing prediction market operators to target ads at people in gives states — Connecticut, Michigan, Nevada, New York or Ohio.

We should make a distinction here: Google imposed these advertising restrictions. The five states didn’t jointly pass some new Google ad ban. However, the states may have pressured Google to do so.

All five states have clashed with prediction markets before, and all want them out of their state. So our guess is the states are cahoots with Google. We mean, ask yourself, why wasn’t this policy retroactively applied to all 50 states? Why just these five?

It wasn’t a sweeping ban in one day either. Ohio’s restriction took effect June 2, followed by Michigan and New York on July 13. Connecticut is the newest addition, with its ban effective October 7.

Interestingly, Google only opened up advertising to qualifying prediction market operators on January 21 of this year. Operators needed Google’s certification and had to qualify as federally authorized exchanges or eligible brokerages. But the opportunity was there: get approved and start advertising. So not even a year later, five states have gotten booted from it.

Surely, more are joining them soon, right? We know California would love to be included, as we’ll get into next.

California Could Be Next To Ban Ads On Google

California has a long, but recent history of trying to get prediction markets to stop offering sports contracts in its state. In June, Attorney General Rob Bonta joined 36 other attorneys general in a court filing defending Ohio’s authority to enforce its gambling laws against Kalshi. His office said it was California’s seventh multistate filing targeting these companies.

The tribes have been doing their own fighting, too. Blue Lake Rancheria and Chicken Ranch Rancheria sued Kalshi and Robinhood over sports contracts offered on their lands. They argue those contracts infringe on their sovereign rights because, no matter what they’re called (financial derivatives, prediction markets would argue), they are betting products at heart.

That argument got somewhere in September. The Ninth Circuit found the tribes were likely to succeed on their gaming-law claims and sent the case back for further consideration of an injunction. This wasn’t a California-wide ban, but it gives the tribes some hope.

They’ve also gone directly after the advertising. The same lawsuit challenged Kalshi’s claim that sports betting was legal in all 50 states on its platform. That part failed, with the court treating the claim as an opinion about unsettled law.

That’s what makes California worth watching here. It’s been one of the state’s most hostile toward prediction markets in the past year. Banning them from advertising on Google doesn’t make them entirely happy (probably), but it would be a small win. A win that’s needed after so many attempts to stop them have failed.

Federal Protection Only Goes So Far With Google

Why have prediction markets been able to stay up despite a seemingly never-ending list of lawsuits from states and tribes? Federal oversight, that’s how.

Prediction markets keep arguing that their contracts fall under the Commodity Futures Trading Commission so states can’t simply treat it like an unlicensed sportsbook and shut it down. State governments don’t have power over the feds, and that’s that.

Going back to Google, its policy starts with federal credentials, too. To qualify for prediction market advertising, a company must be an eligible CFTC-authorized exchange or an eligible brokerage authorized by the National Futures Association. Then it needs Google’s certification on top of that.

But here’s the catch: Google also requires the products and ads to comply with local laws and regulations. Federal authorization alone doesn’t guarantee advertising access, which is why an otherwise eligible operator still can’t throw up ads in those five excluded states. Google has its own approval process, and “we’re federally regulated” only gets a company through part of it.

That’s an interesting side quip. Really, the federal oversight is the only thing keeping prediction markets alive. Google didn’t care for it, but imagine if the Supreme Court said the same? That would settle this debate, once and for all, and not in favor of prediction platforms.