Prediction market platforms have offered event contracts on sports for more than a year now. Apparently, that won’t include Saturday’s Kentucky Derby.
Neither Kalshi nor Polymarket is offering markets on the 152nd edition of the Run for the Roses. Polymarket initially listed a market on the biggest horse racing event, but quickly removed it at Churchill Downs’ request, which owns the Derby.
“We reached out to Polymarket and asked for the wagers to be removed,” Churchill Downs spokesperson Breck Thomas-Ross told ESPN. “And Polymarket complied.”
Federal Law May Prevent Market Trading
Not listing the Derby is in stark contrast to the companies’ efforts to launch into sports. Kalshi, Polymarket, and other platforms regularly list trading options for major sporting events, including the Super Bowl and March Madness.
The platforms have also sued states that have claimed the companies’ trading contracts violate state gaming laws. Unlike other sports, however, the 1978 Interstate Horseracing Act gives state gaming regulators significant power to oversee betting on horses.
“Right now, the law’s fairly clear on what [prediction markets] are allowed to do without consent by our sport,” National Thoroughbred Racing Association President and CEO Tom Rooney told ESPN. “There is a door that could be opened if a race track or state gaming commission or horseman’s group or something like that would give consent. We don’t have that yet.”
Rooney wrote a letter to the Commodity Futures Trading Commission (CFTC), the agency tasked with regulating prediction markets. Rooney said that trading on horse racing would violate the Interstate Horseracing Act.
Leagues Working With Platforms On Protecting Game Integrity
The CFTC hasn’t responded to Rooney, but the move by Churchill Downs may be a way to protect traditional wagering on the race. The sports betting industry has been concerned about cannibalization of revenue because of the growth of prediction markets.
Last year’s Derby saw record wagering, and pushing prediction markets not to list the race may be an effort to keep those dollars flowing into betting at tracks and simulcast facilities.
Prediction market firms have argued their offerings are different from traditional sports betting and regulated solely by the CFTC. Horse racing makes use of pari-mutuel wagering, with final odds released once the betting window closes. Then, tracks and operators take a cut of the entire betting pool and post final odds based on how much money is wagered on each horse.
This structure is similar to how prediction markets operate, except traders know the price they are getting at the time of the wager.
Other leagues have also pushed for prediction markets to limit offerings on their sports. The NBA is asking prediction markets to remove markets for players 18 to 20 years old.
NBA asking for a ban on 18-20yo trading for sports event contracts pic.twitter.com/GHmVmcN1rz
— Isaac (@roundrobin42) April 30, 2026
MLB announced a deal with Polymarket in March. It included a memorandum of understanding with the CFTC to help with ensuring game integrity. The NHL reached deals with Kalshi and Polymarket in October. The league is currently working with the CFTC to create guidelines for event contracts on sports.
