NBA strikes deals with prediction markets, with eye on integrity and regulations
MIAMI (AP) — The NBA has struck deals that will make Kalshi and Polymarket the league’s preferred prediction markets, along with an agreement with a federal agency tasked with regulating those exchanges.
The NBA has inked agreements with Kalshi and Polymarket, designating them as the league's preferred prediction markets, accompanied by a partnership with a federal agency responsible for overseeing such exchanges. These agreements, announced on Monday, aim to safeguard "significant integrity protections for NBA-related markets," encompassing limitations on the offerings available on these platforms, transparency regarding unusual user behavior, and a prohibition against NBA personnel engaging in trades linked to league events.
The NBA's prediction markets will be required to share information related to investigations and suspicious trading activities. The NBA has previously implemented similar safeguards with its sportsbook partners, flagging irregular betting patterns. Scott Kaufman-Ross, the NBA's head of media distribution and partnerships, emphasized the importance of regulated markets for fans and the league, stating, "If you're going to be betting on our games or trading on our games or playing fantasy around our games, it's better for it to be regulated than unregulated."
The NBA is also broadening its partnerships with current official sports betting allies, such as DraftKings, to encompass their prediction-market activities. While not all states have legalized sports betting, prediction markets are accessible in most of the 50 states. Over a dozen states are currently involved in legal disputes over prediction markets.
Earlier this month, the NFL sought Supreme Court review of the regulation of such markets. Earlier this month, the NBA informed sportsbooks that they would not be allowed to offer specific wagering types this season, including player-first-stat wagers, opening tip outcomes, and betting on players with limited playing time. The recent deals are anticipated to include comparable limitations.
"A significant aspect of this is the constraint on the types of markets that can be offered," Kaufman-Ross explained. "We will have the authority to approve the markets available on our games, a crucial factor for us. We have engaged in constructive discussions with the companies as part of this process." The NBA's memorandum of understanding with the CFTC underscores a shared dedication to ensuring NBA-related prediction markets endure appropriate regulatory oversight and integrity safeguards.
As part of their NBA partnerships, Kalshi and Polymarket will be able to use league intellectual property like logos, obtain NBA statistical data from Sportradar for operating and settling authorized NBA-related markets, and engage in other marketing collaborations. The terms of the NBA's agreements with Kalshi and Polymarket were not disclosed, aside from the league confirming multi-year commitments.
NBA players with business ties to these markets include Miami's Giannis Antetokounmpo, who has promoted Kalshi, and Philadelphia's LeBron James, who recently signed with Polymarket. Victor Wembanyama, an NBA star from San Antonio, recently expressed his reluctance to endorse such sites.
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