Kalshi could soon have a new major competitor in the industry, as rumors suggest that the derivatives marketplace CME could be launching sports contracts.
According to Bloomberg, who cite people familiar with the matter, the CME Group Inc “is planning to debut financial contracts tied to both sports games and economic indicators by the end of the year.”
The publisher continues to suggest the Chicago-based company is preparing to release its new contracts to the public through futures commission merchants, including one it is rumored to be setting up with FanDuel. It’s thought that CME could also offer them on other similar platforms too.
While Bloomberg cites people familiar with the matter, the sources have declined to be identified as they say the plans are still private. A representative from CME declined to comment in the published piece.
What are prediction markets? CME gets rumor mill swirling
A prediction market is where people can trade contracts that pay based on the outcomes of events that have an unknown future. It’s not just related to sports, but can be any topic of event.
This rumor comes at a time when prediction markets are becoming hot topics in society, with popularity of the industry rising. Some state regulators don’t have favorable views on prediction markets, with the likes of the Arizona Department of Gaming having sent out communications to approved sportsbooks warning them that offering prediction outside of Arizona could put their license at risk.
The executive director of the Pennsylvania Gaming Control Board (PGCB), Kevin F. O’Toole, has also recently expressed an issue with the rise of sports wagering on prediction markets. He claimed that the “growing presence” of these markets is a “significant threat” to Pennsylvania’s regulations.
The industry hasn’t gone unnoticed by the entertainment sector either, as the American sitcom South Park recently went all in on prediction markets in a recent episode named ‘Conflict of Interest.’ It discussed prediction markets at length which caused those in the industry to share meme-able moments from the show on social media platforms after.
ReadWrite has reached out to CME for comment.
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