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U.S. CFTC secures deal with National Hockey League on prediction market safeguards
TL;DR
The U.S. CFTC has reached an agreement with the NHL to oversee betting on prediction markets, enhancing safeguards against insider trading and fraud. This follows similar arrangements with other professional sports leagues.
Key points
- CFTC and NHL agree on oversight of prediction markets
- NHL to share information on event contracts
- Agreement aims to prevent insider trading and fraud
Mentioned in this story
U.S. Commodity Futures Trading CommissionNational Hockey LeagueKalshiPolymarket
In the midst of its playoffs surge, the top professional hockey league has agreed to coordinate oversight of betting on popular prediction markets with the U.S. Commodity Futures Trading Commission, securing a new memorandum of understanding similar to the one recently struck with Major League Baseball.
The National Hockey League, which had officially linked itself last year with both Kalshi and Polymarket as the league's official prediction market partners, has agreed to share information with the regulator on event contracts tied to its games, according to a Thursday statement from the agency. The CFTC has been pursuing similar arrangements with all of the professional sports leagues, Chairman Mike Selig said at an event last week.
"This agreement is another step toward safeguarding the integrity of sports and protecting market participants in prediction markets from insider trading, fraud, and other abuses," he said of the NHL arrangement in a statement.
Selig has made it a point to foster the industry and to defend his agency's role as its sole regulator.
Prediction market betting has seen explosive growth in recent years, and along with its popularity has come concerns that the wagering is being abused and is encouraging cheating. In a Senate Commerce Committee hearing this week, lawmakers criticized the dark side of the industry. Bad actors — including among the athletes themselves — threaten to "sow doubt in the minds of fans," said committee Chairman Ted Cruz.
"Integrity has always been and remains paramount to the NHL and fundamental to the trust our fans and partners place in our game,” said NHL Commissioner Gary Bettman, in a statement released by the CFTC. “Our agreement with the CFTC enhances the comprehensive integrity monitoring systems already in place and strengthens our ability to identify, deter, and address potential risks."
According to the new MOU, the league and regulator will "endeavor to share information, upon request, regarding the integrity of professional hockey and the event contract markets related thereto or other matters deemed appropriate."
Read More: Prediction markets firms take heat in Senate Commerce hearing scrutinizing surge
Q&A
What is the agreement between the CFTC and the NHL about?
The agreement involves the NHL coordinating with the CFTC to oversee betting on prediction markets and share information on event contracts related to its games.
Why is the CFTC focusing on prediction markets in sports?
The CFTC aims to safeguard the integrity of sports and protect market participants from insider trading, fraud, and other abuses as prediction market betting grows in popularity.
What concerns have lawmakers raised about prediction market betting?
Lawmakers have expressed concerns that prediction market betting may encourage cheating and abuse, potentially undermining fan trust in the integrity of sports.
