The National Basketball Association (NBA) has added its voice to a chorus of disapproval at the Commodity Futures Trading Commission’s latest prediction markets-related rule-making.
The NBA wrote to the CFTC on Monday, echoing many of the sentiments spelled out in an earlier letter from the NFL, American football’s governing body.
The CFTC issued its most recent rule-making in June. But while the rule-making proposes some regulations for sports-related contracts, the NBA says it is incomplete.
“[The rule-making] falls well short of requiring prediction market companies to comply with the most basic sports integrity protections,” the NBA wrote.
The development comes as US lawyers warn that prediction market players like Kalshi, Polymarket, and others must diversify away from sports or face more regulatory challenges.
“A platform that is 80% sports volume is not a prediction market,” Braden Perry, partner at Kennyhertz Perry LLC and a former CFTC senior trial attorney, told CasinoBeats earlier this week. “It is a sportsbook with a preemption argument.”
NBA: Prediction Markets Must Do More to Ban Minors
Like the NFL, the NBA urged the federal regulator to “categorically prohibit trading of sports prediction contracts by individuals under 21.”
However, the NBA suggested that if a ban on under-21s did not materialize, it could settle for a ban on marketing aimed at individuals aged 18 to 20.
The NBA also insisted that it and other sports leagues should have a say in which markets are blocked, on the grounds that they could be easily manipulated.
The NFL made a similar appeal in its letter, objecting to the fact that prediction market operators trade contracts on events that are knowable in advance or easily manipulated by a single person.
These include the nature of the first play of the day in NFL games, for example, or refereeing calls.
And the NBA also objects to the fact that the rule-making does not oblige prediction market operators to contact sports leagues if they detect suspicious trading activity on their platforms.
The NBA has previously expressed its dismay that prediction markets can offer contracts on player trades.
In its latest letter to the CFTC, the association cited its April letter to the regulator on this matter.
The topic of player trade contracts has proven controversial in recent weeks, with around $200 million staked on Kalshi contracts pertaining to NBA star LeBron James’ next team.
“Markets relating to officiating, injuries, league disciplinary actions, player or team transactions, or fan actions should be prohibited,” said the NBA in April.
“These markets are readily susceptible to manipulation or improper use of confidential information and have a negative effect on perceived game and league integrity,” the league added.
US Sports Leagues: Not All Sing from Same Hymn Sheet
The relationship between prediction markets and sports leagues is far from a straightforward adversarial one, however.
Earlier this year, Major League Baseball struck a cooperation deal with the CFTC and named Polymarket as its exclusive partner. Major League Soccer signed a similar deal with Polymarket in January.
The National Hockey League, meanwhile, signed a multiyear partnership agreement with Kalshi in October.
The NHL followed up by penning a prediction markets cooperation deal with the CFTC in May.
US-based sports stars such as Lionel Messi have also promoted Kalshi and other platforms on their social media pages.
Ahead of the World Cup, Messi posted a promo for Kalshi alongside his Argentina teammates Rodrigo De Paul and Nicolas Otamendi.
