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SafeBets confirmed it is exempt from a newly signed Minnesota law that will make operating a prediction market a felony in the state because users on its platform do not risk money or fund payouts through losses.
The law, signed by Minnesota Governor Tim Walz and set to take effect in August 2026, defines a prediction market as a system that allows consumers to “place a wager on a future outcome.”
SafeBets said its users never place a wager because they do not deposit money, stake capital, or risk financial loss on the platform.
The company stated that its business model differs from conventional prediction market operators such as Kalshi and Polymarket, where prize pools are typically funded by losing participants.
Instead, SafeBets monetizes the collective intelligence of its community by deploying verified prediction signals to trade financial markets across cryptocurrency, commodities, equities, and currencies.
“Prize pools are funded by market inefficiencies captured through proprietary trading,” the company said. “No user funds the prize pool. No user’s loss creates another user’s win.”
SafeBets alleges the positive-sum architecture removes the legal element of “consideration” that is commonly used to classify gambling activity under U.S. law, resulting in a platform that is compliant with anti-gambling laws everywhere, whereas zero-sum platforms are not.
The statement comes as prediction market operators face mounting regulatory scrutiny across the United States.
SafeBets cited 20 criminal charges filed by Arizona authorities against Kalshi in March 2026, a Nevada court ruling that described Kalshi’s sports event contracts as “indistinguishable from state-regulated sports gambling,” and ongoing federal lawsuits involving five states over jurisdictional disputes tied to the industry.
The company also pointed to briefs filed by 38 state attorneys general opposing what it described as the zero-sum prediction market model, more than 20 active lawsuits across multiple jurisdictions, and legislative proposals in at least eight states seeking to ban or restrict prediction markets.
Polymarket is currently banned for U.S. users, while Kalshi faces cease-and-desist orders and legal challenges in several states.
SafeBets remains able to operate without restriction in all 50 U.S. states and across 135 countries.