Texas doctors seek minimum age of 21 for prediction markets
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Health experts in Texas are calling on state leaders to restrict prediction market platforms to protect young people.
Why it matters: As Polymarket and Kalshi make a bigger play in the sports industry, medical professionals across the country are cautioning that prediction markets can fuel gambling addiction.
The big picture: Most forms of gambling remain illegal in Texas. But residents can participate in prediction markets because federal regulators classify prediction market contracts as financial derivatives instead of traditional gambling.
Zoom in: The Texas Medical Association is asking state lawmakers to restrict prediction market participation to those 21 and older and limit advertising near schools and parks and on social media and gaming platforms that cater to adolescents.
What they're saying: While participating in prediction markets is not legally considered gambling, "it has all of the psychological trappings of gambling," pediatrician Lindy McGee, who chaired TMA's committee on child and adolescent health, said in a statement.
- "The adolescent brain is primed to take risks. ... The younger you start, the more likely you are to become addicted to it," McGee said.
How it works: In prediction market platforms, users can put money on future outcomes in everything from sports to elections. If the anticipated outcome happens, their winning contract is paid out.
- The companies insist prediction markets are not like traditional gambling or sportsbooks because they operate as exchanges, where users are up against each other.
- Some states and the federal government are embroiled in a legal conflict over who should regulate prediction markets. There have also been allegations of insider trading.
Between the lines: The push to curb prediction market participation comes as many Texans want to see gambling legalized in the state.
What's next: A Texas Senate committee plans to examine "the sudden inundation of prediction market gambling and the exploitation of federal law to circumvent Texas gambling prohibitions," per the committee's website.
- The Legislature convenes in January.