Why It Matters
South Carolina’s gubernatorial race is shaping up as a test of Republican policy consistency on gaming and free markets. As prediction markets expand nationwide and federal courts affirm their legality, the state’s candidates are staking out positions on whether to maintain the state-run lottery monopoly or allow private-sector competition through a public referendum.
The debate carries direct fiscal implications for the state’s education lottery funding model and could reshape the regulatory landscape for online and brick-and-mortar gaming in the Palmetto State.
What Happened
U.S. Representative Nancy Mace this week called for a statewide referendum on casino gaming during a Republican gubernatorial debate. Mace argued that South Carolinians already participate in online prediction markets and sports betting, and voters should decide directly whether to expand private gaming options.
Lieutenant Governor Pamela Evette told reporters she supports working with the legislature on regulatory frameworks for prediction markets, which already operate in South Carolina. Attorney General Alan Wilson’s campaign indicated a willingness to engage on the issue but did not commit to a specific policy position.
The positioning comes as federal regulators and courts move to protect prediction markets from state-level bans. The Commodity Futures Trading Commission and Department of Justice filed lawsuits against multiple states attempting to shut down these platforms.
By the Numbers
South Carolina approved its state-run lottery by referendum in 2000. The lottery currently distributes tens of millions of dollars annually to colleges and universities, including faith-based institutions.
Earlier this week, the U.S. Court of Appeals for the Third Circuit upheld a preliminary injunction blocking New Jersey from shutting down Kalshi’s sports wagering contracts. The court ruled that only the CFTC has jurisdiction over prediction market regulation.
State lawmakers are separately considering legislation that would allow counties and municipalities to hold local referendums on Sunday liquor sales, which are currently banned statewide.
Zoom Out
The South Carolina debate mirrors national Republican tensions between free-market principles and social-conservative opposition to expanded gaming. President Donald Trump, a former casino operator, has publicly endorsed prediction markets.
Federal courts have consistently sided with the CFTC in jurisdictional disputes with states over prediction markets. CFTC Chairman Michael Selig said the agency will defend its exclusive regulatory authority against state efforts to restrict these platforms.
What’s Next
The South Carolina legislature will decide whether to place gaming questions on the ballot for public referendum. Lawmakers are also considering local-option referendums for Sunday liquor sales, which could set a procedural template for county-level decisions on other regulated industries.
The 2026 gubernatorial race will test whether Republican primary voters prioritize market liberalization or maintain support for the state lottery monopoly.