Major League Baseball (MLB) has asked the Commodity Futures Trading Commission (CFTC) for an integrity framework for sports event contracts to be created.
‘The Closing Line’ substack has shared a letter written by the sports league to the acting chairman of the CFTC Caroline D. Pham which is dated March 7, 2025.
Within it, an ‘integrity framework’ is reported to have been encouraged which would resemble what the legal sports betting industry has to adhere to.
According to the Substack, the letter states: “As the resemblance between sports event contracts and traditional sports betting markets continues to grow, so too does the need to replicate the integrity and consumer protections that exist at the state level. Currently, those protections are lacking.”
This comes just days after regulators in Nevada sent a cease-and-desist to Kalshi as they suggested the platform was offering illegal gambling in the state. The prediction-based company allows users to ‘trade on anything’ from politics to sports and even the weather.
When Luana and I founded Kalshi at 21, we set out to build prediction markets into the world’s largest financial market. From day one, we defined a core principle: Do things the right way.
We knew that regulation and trust had to be the foundation to build something enduring.… pic.twitter.com/0yxPYveoJi
— Tarek Mansour (@mansourtarek_) March 5, 2025
In response, the CEO at Kalshi Tarek Mansour posted on X to say: “Kalshi will stay committed to our approach and keep paving the way for regulated prediction markets to thrive in the U.S” after stating he was ‘disappointed’ to see the letter from the Nevada Gaming Commission.
MLB continues topic of prediction markets as CFTC launches roundtable
Dustin Gouker, the author of The Closing Line report, states the letter continues: “MLB has supported legal sports betting at the state level based on robust regulation and relationships in which sports leagues are viewed as partners and integrity of competition is considered paramount.
“If the CFTC decides to permit sports event contracts, this same integrity framework should be applied.”
It also comes at a time when the CFTC is conducting a 90-day review of the legality of sports event contracts. This began on January 25 and will continue until April 25, 2025.
A predictions markets roundtable will also be held by the CFTC as it seeks out more information with the goal being to develop a ‘robust administrative record with studies, data, expert reports, and public input.’ This will then help to inform the Commission’s approach to regulation and oversight of prediction markets, including sports-related event contracts.
Featured Image: Credit to Galaksiafervojo on Wikimedia Commons
