Tennessee lawmakers are pushing ahead with legislation that would make it a felony to try to sway the outcome of events tied to prediction market conduct when money is on the line.
The state Senate signed off on Senate Bill 1992 on Thursday (April 9), backing the proposal 28-1 after first adopting an amendment earlier in the day. The measure mirrors House Bill 2079 and now moves forward as part of a wider effort to regulate emerging online trading platforms built around future events.
States that have introduced prediction market restriction/ban bills this year (more can/will follow):
-California
-Connecticut
-Georgia
-Hawaii
-Illinois
-Kentucky
-Minnesota
-New Jersey
-New York
-Tennessee
-Virginia
-Vermont
— Ryan Butler (@ButlerBets) March 25, 2026
The bill creates a new criminal charge aimed at people who attempt to influence outcomes while financially invested in them through prediction market contracts.
New criminal offense targets prediction market conduct in Tennessee
Under the proposal, someone would break the law if they take steps to affect the result of an event while they, or someone working with them, holds a position in a related prediction market. The key issue is financial benefit, whether direct or indirect.
The bill states that a person violates the law by taking such action “while the person or another is a party to a contract with a prediction-market by which the person will benefit, directly or indirectly, from the occurrence of the outcome.”
If convicted, the offense would be treated as a Class E felony in Tennessee.
Lawmakers also lay out a general definition of prediction markets, describing them as “a platform on which individuals trade contracts based on the outcome of unknown future events.” This leaves the law open to covering everything from political outcomes to sports and other speculative markets.
The push comes as the Volunteer State is already locked in legal disputes with several prediction market operators. The state previously issued cease-and-desist letters to companies including Kalshi, Polymarket, and Crypto.com, arguing their offerings violated state law.
It has faced resistance in court. A federal judge recently blocked Tennessee from enforcing restrictions against Kalshi’s sports-related contracts, and the company also secured a temporary restraining order against the state’s actions. The rulings have added uncertainty around how far Tennessee can go in policing these platforms.
Even so, the new legislation takes a different angle by focusing on individual behavior rather than platform legality. By placing the offense within Title 39, which covers property-related crimes, lawmakers are framing manipulation tied to financial gain as a form of economic wrongdoing.
If it ultimately becomes law, the measure would take effect July 1, 2026.
Featured image: Kenneth C. Zirkel via WikiCommons / CC BY-SA 4.0
