(Radio Iowa) – Iowa could become the first state in the nation to regulate prediction markets that let people bet on future events like elections, government policy decisions, sports and even the weather. The Iowa Senate has passed a bill that would charge a state tax on prediction market activity in Iowa and require companies that are in the prediction market business to be licensed in order to take bets from Iowans. Senator Dan Dawson, a Republican from Council Bluffs, says Iowa is taxing AND regulating sports betting and gambling at state licensed casinos, but prediction markets are operating without federal government oversight.
“The state of Iowa has little to no information as to how many of these contracts are being placed, of what types,” Dawson said. Dawson says a big concern is how much of the activity in prediction markets is tied to sports, without the 21-or-older age restriction in place for state regulated sports wagering or the required financial support for programs to address gambling addiction.
“The way predictive markets have metastasized in recent years poses a high potential to explode a public health risk to our state,” Dawson said, “with no infrastructure provided by these companies.” Senator Herman Quirmbach, a Democrat from Ames, says people with inside information may be placing bets when they know the outcome of an event before the general public does.
“And may be able to use that private insider information to personally profit,” Quirmbach said. “I think that is unacceptable.” The bill passed the Senate 45-to-one this week and is not yet scheduled for review in the Iowa House. Some members of congress have suggested it’s time to regulate the industry and last week California’s governor issued an executive order barring state employees from placing bets on events that are connected to state government.
