After reaching deals with prediction market firms Kalshi and Polymarket in October, the NHL said it is working with the Commodity Futures Trading Commission (CFTC) to create guidelines for event contracts trading involving sports.
Criticism of the industry has grown over integrity concerns since Kalshi and other prediction markets began offering trades on sports a year ago. The NHL hopes to alleviate those concerns by working with federal regulators on safeguards.
“We’ll see what those discussions yield, but I think it’s really just to kind of work together to make sure we’re all comfortable, NHL Commissioner Gary Bettman told the Associated Press. “There’s a comfort level that the games will remain secure and the integrity will be protected.”
Proactive Approach
Bettman indicated discussions were in the early stages and have focused on game integrity. State gaming regulators have argued that prediction markets’ sports event contracts are nothing more than betting and violate state gaming laws.
That has led to a series of legal battles in both state and federal courts. The CFTC has asserted more control over the process in recent weeks, filing lawsuits against Arizona, Connecticut, and Illinois and also announcing a similar legal action against New York this week.
The CFTC condemns state efforts to supersede the commission’s sole regulatory power over the industry.
“I have to assume they’ll be a fine enforcement body, but we’re early on in our approach to them,” Bettman said. “I don’t know if this is in their mainstream or not. Probably going to be a little learning by everybody involved in those discussions.”
The commissioner said a general “memorandum of understanding” for all sports leagues could be possible and discussions surrounding the issues would continue.
Asserting A Level Of Control
The NHL was one of the first leagues to embrace prediction markets. Bettman believes partnerships with the industry also give the league a level of control over some of the platforms’ offerings.
“You have to acknowledge the things that are going on around you,” he said. “And first of all, if there was going to be prediction contracts, we wanted them based on your back for the benefit of our fans.
“But secondly, and most importantly, we have the ability to knock out any prediction contracts we don’t think are appropriate, which gives us more control. And we are monitoring that market in real time. So that in the event a contract is the one that we don’t think is appropriate, we can envision the reasons we might not think it was appropriate. We can make them take it out.”
Other leagues have also partnered with prediction market firms. MLB signed a deal with Polymarket in March and announced an agreement with the CFTC to establish an integrity framework. The UFC and MLS also have deals in place with prediction market companies.
In related news, Sen. Richard Blumenthal (D) pressed major American pro sports leagues earlier this month on game integrity, gambling addiction prevention, their efforts to protect athletes, and compliance with state laws in any partnerships with prediction markets.
