A provision in North Carolina's proposed state budget that would authorize prediction markets is fueling some criticism, with one group calling it a "sweetheart deal" for the companies.

Why it matters: Prediction markets are currently regulated at the federal level, which treats them as futures contractors rather than gambling sites.

• But critics say futures contracts are no different than gambling and should be regulated state-by-state, Axios previously reported.
• They include North Carolina Attorney General Jeff Jackson, who co-signed a letter in April pushing back on the federal regulatory framework for prediction markets.

Driving the news: The Republican-authored budget, which has been sent to Gov. Josh Stein's desk, would make North Carolina the first U.S. state to authorize prediction markets licensed by the Commodity Futures Trading Commission, according to analysts.

• It doesn't impose regulatory requirements on prediction market companies but does tax their net trading fee revenue at 6%.
• That's far less than the 23% rate that sports gambling companies would be taxed at under the same budget.

Zoom in: You can trade contracts on nearly anything on prediction market apps, including sports outcomes, world events, political votes and even the weather.

• Some sports wagers appear indistinguishable from those available on sports gambling apps.

What they're saying: House Speaker Destin Hall told reporters last week that with prediction market apps like Kalshi or Polymarket growing in popularity, it was "just time to deal with it."

• "Whether it's something that eventually is going to take over from the sports betting, I don't know," Senate leader Phil Berger said separately.
• Kalshi declined to comment to Axios on the new provision.
• A spokesperson for Polymarket said it complies with regulations under the Commodity Futures Trading Commission. "[S]tate-level efforts to regulate prediction markets will likely face significant federal preemption challenges," the spokesperson added in a statement.

The other side: "Prediction markets are unlicensed sports gambling apps — full stop," Mick Mulvaney, executive director of the group Gambling Is Not Investing and President Trump's former acting chief of staff, said in a statement.

• "The proposed North Carolina budget legitimizes and gives a sweetheart deal to the same prediction market operators that are trampling on the state's gambling regulations while opening a pathway for underage users to gamble on sports through prediction markets," he added.
• "I don't know who their lobbyists are, but congratulations. That's just rich," state Sen. Julie Mayfield (D-Buncombe) said before voting for the budget last week.

What's next: Revenue would begin being taxed Jan. 1 if the budget becomes law.

Editor's note: This story has been corrected to reflect that Sen. Julie Mayfield voted for the budget (not against it).

Share this story

A private company's $15.4 million bid to buy Raleigh's city-owned Wilmington Street parking deck has been withdrawn ahead of today's City Council meeting.

Why it matters: The potential sale of the deck, whose free two-hour parking is popular with downtown visitors, especially those visiting Marbles Kids Museum, was met with significant pushback from the downtown business community.

Driving the news: City Council had been scheduled to consider the offer from Gold Crown Management Co. at its meeting today, but the bid was withdrawn last week, according to city spokesperson Julia Milstead.

What they're saying: "We recognize that the offer created a lot of conversation in the community," Milstead said in a statement. "As the city grows, we continue to look for efficiencies in our systems so that our residents' tax dollars deliver the highest level of services."

Between the lines: Businesses have said the city-owned parking decks — and the two-hour free parking that has been offered since 2024 — remain critical to getting visitors back downtown during its post-pandemic recovery.

What's next: What Raleigh should do with its parking decks, which lose money and need repairs, remains up for debate.

• The city is studying its downtown parking operations, and the findings could shape the council's next steps.

Go deeper into the issue

🚔 Raleigh Mayor Janet Cowell said the city could consider a youth curfew after "teen takeovers" on July 4 led to several shootings in the Brier Creek and Glenwood South neighborhoods. (WRAL)

🌀 A year later, Tropical Storm Chantal's effects are still visible in Eno River State Park. (WUNC)

🪖 Fort Bragg's name could once again be changed to Fort Liberty. (News & Observer)

Yesterday, we asked what spots Axios Raleigh readers think have great merch.

Zoom in: If your closet needs something fresh, here are some of the favorites:

• 🍕 Benchwarmers (Raleigh) -Ben C.
• ☠️ Burial (Raleigh) and Blackbird Books & Coffee (Raleigh) -Sarah M.
• 🍻 The Daily Beer Bar (Durham) -Max N.
• ☕️ Coffee shops Sola (Raleigh) and Fount (Morrisville) -Clayton C.
• 🔢 321 Coffee -Rick H.
• 🐟 Saltbox Seafood Joint (Durham) -Heather L.
• ⚽️ Eno River Brewing (Hillsborough) -Brian V.

GoRaleigh's Route 1 topped 1 million riders in the fiscal year ending June 30, making it North Carolina's busiest bus route.

Why it matters: The milestone strengthen's GoRaleigh's case for expanding high-frequency bus service, which the agency says has rapidly grown ridership.

Zoom in: Route 1 stops every 10 minutes on weekdays and every 15 minutes on weekends.

• Buses stop downtown and take Capital Boulevard to Triangle Town Center.

What they're saying: "We believe it to be true, 'if you build it, they will come,'" assistant city transit director Het Patel said in a news release. "We are so proud of the team that made this happen. Servicing a million riders on one route is no easy feat."