Hawaii Senator Pushes for Federal Ban on Micro Prop Bets

^{Banning micro bets and fighting offshore gambling have been recent priorities for Hawaii Sen. Brian Schatz. (Photo: Alan Kotok / Alamy)}

Sen. Brian Schatz (D-Hawaii) announced last week that he is prepared to introduce legislation that would outlaw micro prop bets nationally, saying that the wagers create vulnerabilities for both bettors and the integrity of sporting events.

The announcement came in the wake of a Senate Commerce subcommittee meeting that discussed the growing sports betting and prediction market industry and its impact on game integrity.

Schatz represents Hawaii, one of only two states in the country with no legal gambling, which gives him a notably different perspective on the sports betting industry than most of his colleagues. 

Prop Bets Becoming Easy Target for Regulators

Prop bets have attracted significant pushback from regulators, with many states having banned proposition wagering on college athletics. In 2025, Ohio Gov. Mike DeWine called for a similar ban on pro sports in his state after two Cleveland Guardians pitchers were caught in a scheme related to first pitch wagers to start innings during the 2025 MLB season.

Leagues have jumped in on the action too, with both the NBA and the NBA Players Association calling for limits on player prop bets as well.

“Micro prop [bets are] insidious in that [they] can be manipulated by a player or anyone else,” Schatz said during the committee meeting. “The more micro you get, the more insidious it is, from an integrity standpoint. But it also taps into the addictive, manic, algorithmically-driven problem that we’re dealing with. I think this particular problem is especially acute and needs to be dealt with immediately.”

Narrower Bill Offers Tools to Fight Offshore Gambling

While several federal legislators have introduced various bills to provide more federal oversight to the state-regulated sports betting industry, Schatz’s suggestion is narrower than most.

In 2024, Sen. Richard Blumenthal (D-Conn.) and Rep. Paul Tonko (D-N.Y.) introduced the SAFE Bet Act, which would require every state that wants to regulate sports betting to apply with the U.S. Justice Department, which would have to approve or reject the proposals. It would also include a ban on college sports prop betting, and severely restrict advertising and marketing campaigns.

More recently, Blumenthal and Sen. Katie Britt (R-Ala.) introduced the Gaming Advertisement to Minors Enforcement (GAME) Act earlier this month. That bill would prohibit social media companies from allowing minors to see sports betting advertisements, with the senators citing studies that show young boys are being exposed to gambling in video games and on social media.

Schatz’s bill also addresses offshore gambling, giving the Federal Trade Commission (FTC) authority to take action against companies that facilitate unregulated sites.

“If you empower the FTC to go after the payment processors, then they would have a perfect right to go and say, “you may not work with these offshore shops if they are not complying with federal law having to do with micro prop bets,” Schatz said.

Schatz’s focus on sports betting went against the grain for last week’s hearing, which saw much of the attention thrown on prediction markets. There appeared to be bipartisan concern over the breadth of markets available on platforms like Kalshi and Polymarket, and questioned whether Congress ever meant to give the Commodity Futures Trading Commission control over sports-related contracts.