NFL Believes CFTC’s Rules On Prediction Markets Are ‘Falling Short’

• NFL SVP of Public Policy and Government Affairs, Brendon Plack, issued a 7-page letter to the Commodity Futures Trading Commission on Monday.
• The NFL believes the CFTC is “falling short” of addressing concerns the league has around prediction markets and the integrity of the game.
• The CFTC issued a 267-page rules release following initial input from the NFL and other professional leagues on concerns over predictions markets.

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The National Football League still believes that the Commodity Futures Trading Commission is falling short of addressing the concerns the league has when it comes to the risks around predictions markets.

In a letter addressed to CFTC Chairman Michael Selig on Monday, SVP of NFL Public Policy and Government Affairs, Brendon Plack, stated that current rules toward prediction markets “fall significantly short of protecting the integrity of sporting events and the fans who participate in these markets.”

Monday’s letter follows another request issued by the NFL toward the CFTC back in May, urging the Commission to prohibit certain football sports event contracts and to raise the minimum age for trading to 21.

Latest Comments Follow Request for Changes in May

The NFL was one of many professional sports organizations to issue comment to the CFTC on the concerns with prediction markets back in May after the Commission requested feedback on how it should police the industry.

In May, the NFL was joined in public comment by Major League Baseball, the National Basketball Association, PGA Tour, and players associations for the NFL, NBA, NHL, MLB, and MLS.

Those comments didn’t lead to much change by the CFTC in a June rules release. It retained markets for game outcomes, player outcomes, season-long outcomes, as well as markets for individual and team performances, final scores, and more.

The CFTC’s proposed rules to govern prediction markets following the comments wasn’t satisfactory to the NFL, according to Plack.

“It is surprising that further common-sense integrity and consumer protection measures provided in the Prior League Comment Letter were not adopted.”

This week’s letter was a 7-page statement that further emphasized what the NFL sought in May.

While the NFL has reached partnerships with multiple online sportsbook operators that are legal in the US, it has not entered into one with a prediction market. However, MLB and the NHL have done so, while NBA star Giannis Antetokounmpo recently was announced as an investor with Kalshi.

What the NFL is Asking of the CFTC

The NFL has focused in on a few particular issues it has with prediction markets and their ability to offer markets tied to the NFL.

The NFL would like to see the CFTC take action against the markets to enforce the following:

• A minimum age limit of 21 to be able to trade on sports-event contracts. Currently, operators like Kalshi and Polymarket allow 18-year-olds to use the platform.
• A ban on sports-event contracts that are vulnerable to manipulation. That can include markets on player performance or officiating. That also includes markets that are based on a “negative” outcome that can be easily manipulated.
• The NFL also wants markets to be banned that could be known ahead of time. That can include trading on the first play of a game, roster decisions, or coaching decisions.
• An easier process for the league to petition the CFTC to remove problematic contracts. A proposed 10-day review period for new event contracts proposed by the CFTC was also taken issue with by the NFL. The league believes the window isn’t enough time for regulators and others impacted to assess the integrity risks related to that market.
• An established list of “bad actors” that are prohibited from participating in event contract trading.

Addressing these issues would help secure the integrity of the league, according to the NFL, while also protecting players, coaches, and referees from additional harassment that occurs over sports gambling.

Dodd-Frank Act Co-Author Speaks Out on Prediction Markets

Another public comment to the CFTC was made by former Connecticut Senator Christopher Dodd.

Dodd was co-author of the Dodd-Frank Act in 2010, a law established to reform Wall Street and protect consumers from unfair and abusive financial practices.

Prediction markets like Kalshi have cited the Dodd-Frank Act as legislation that supports their lawful ability to offer their product in the US.

In his letter to the CFTC, Dodd believes that the law is not being interpreted as it was intended by allowing prediction markets to operate outside of state authority when it comes to online gambling policies.

“In the past year, additional speculators have emerged promoting event contracts that are merely a substitute for gambling,” Dodd said.

“The explosion of prediction markets—especially sports wagering and event contracts—represents the type of rampant speculation we sought to prohibit with the Dodd-Frank bill.”