NFL Sounds Alarm on ‘Objectionable’ Prediction Markets

The NFL argued that the CFTC’s prediction-market rule proposal still falls “significantly short” of addressing risks around integrity, consumer protection, and market manipulation.

The deadline for the latest prediction-market rulemaking comment period was Monday evening, and when the clock struck midnight there were only 130 total comments submitted with thoughts on the CFTC’s rule proposal from June. Hundreds of additional comments appeared on the docket Tuesday morning, putting the total at 736. That’s still fewer than the 1,541 submissions from the prior 45-day period, which opened after the federal regulator initially sought comments on how prediction markets should be policed. 

In May, a number of public comments came from major sports leagues and related entities, including the NBA, MLB, ATP Tour, PGA Tour, and players unions for the NFL, MLB, NBA, NHL, and MLS. Prediction-market platforms Kalshi and Polymarket also submitted comments then, as did NCAA president Charlie Baker, FanDuel, and DraftKings. The unions jointly submitted one comment right up against the deadline this time, as did the NBA, MLB, MLS, FanDuel, DraftKings, and the NCAA. Others that submitted last-minute comments included Kalshi, Polymarket, and Robinhood.

The NFL did not submit a comment in May, but it has now. It’s one of the few remaining holdouts in the world of U.S. pro sports with regard to prediction markets, alongside the NBA (although sources tell Front Office Sports the NBA is closer to reaching prediction-market partnerships than the NFL—the NHL, MLB, MLS, and others, have already embraced the industry).

The NFL’s comment letter, filed on Monday—the deadline for comments to be submitted—was signed by Brendon Plack, the league’s SVP for public policy and government affairs. He wrote that while there are “several productive proposals, it must be strengthened in key areas.”

The league urged the CFTC to adopt a minimum age of 21 for users to trade on sports-event contracts (Kalshi and Polymarket allow people as young as 18 to use their platforms). It also pushed the regulator to implement an outright ban on categories of sports event contracts it believes are especially vulnerable to manipulation, rather than reviewing those markets on a case-by-case basis. This includes contracts on discretionary officiating decisions, individual player performance, and what the NFL called “knowable in advance” markets, such as those on the first play of a game and coaching or roster decisions.

“We believe these objectionable contracts are detrimental to the long-term health of these markets, to the public, and to the leagues,” the letter said.

‘Public Interest Concerns’

The NFL also raised concerns about the CFTC’s stance that markets should be mostly allowed to go live because prohibiting event contracts would “push trading activity into less transparent and less regulated foreign markets.”

According to the NFL, “contracts imposing the greatest public interest concerns may be among the highest-traded. We do not believe that otherwise non-compliant contracts should be permitted because they are in high demand or might otherwise be traded on offshore markets.” 

One notable non-sports industry comment came from Christopher Dodd, a former senator from Connecticut who now works at law firm Arnold & Porter. He co-authored the Dodd-Frank Act of 2010, which was enacted following the global financial crisis with the goal of strengthening oversight of financial markets.

Kalshi and the CFTC have argued that Dodd-Frank provides a framework permitting federally regulated event contracts, including those tied to sports. But Dodd was explicit in his comment letter that he did not view Dodd-Frank as intended to allow federally regulated markets to override states’ authority over sports betting.

“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,” Dodd wrote.