NFL Urges Prediction Markets to Halt Trades on Manipulable Events, Citing Integrity Concerns

The National Football League (NFL) has become the latest major American sports entity to call upon the prediction market industry to refrain from facilitating wagers on outcomes deemed susceptible to manipulation or easy foresight. The league's directive specifically targets market offerings related to events that could potentially be influenced by individuals or are predictable prior to their occurrence.

In a recent communication issued on Sunday, the NFL articulated its apprehension regarding specific types of trades. These include speculation on commentary made by broadcast announcers or the attendance of public figures at significant league functions, such as the forthcoming NFL Draft. The league's primary objective in this appeal is to safeguard game participants from what it terms "unfair and unwanted allegations," asserting that certain events could be readily manipulated or predetermined.

The NFL explicitly named platforms like Kalshi and Polymarket, advising them to discontinue offerings on sports-related events where a single individual theoretically holds the capacity for manipulation. The types of markets the league recommends discontinuing fall into categories such as draft selections, player contract agreements, coaching staff changes, instances of missed field goals, and any other events deemed "inherently objectionable."

Following the NFL's appeal, Polymarket indicated its willingness to engage with the league. A representative from Polymarket conveyed to ESPN that the company is open to collaborating with the NFL on measures designed to uphold the integrity of sports.

This letter from the NFL emerges against a backdrop of ongoing dialogues between the league and the Commodity Futures Trading Commission (CFTC). The CFTC, which serves as the federal regulatory body overseeing the prediction market sector, has been proactive in assisting sports organizations to mitigate potential manipulation facilitated through these platforms. Notably, the CFTC and Major League Baseball (MLB) have forged an agreement to share data, aiming to reduce instances of fraud.

Both the NFL and MLB have recently navigated high-profile controversies involving professional athletes who allegedly violated anti-gambling regulations. While these incidents highlighted existing challenges, prediction markets introduce a distinct set of risks, with persistent worries about the ease with which insiders could potentially manipulate these markets.

In response to concerns about market integrity, platforms like Polymarket and Kalshi have already implemented internal safeguards, including the refusal of payouts on certain markets and to accounts identified as suspicious or manipulated. Concurrently, the National Collegiate Athletic Association (NCAA) has also taken steps, requesting prediction markets to cease unauthorized use of its trademarked intellectual property, specifically referring to terminology associated with the "March Madness" tournament. A previous legal challenge by the NCAA against DraftKings concerning a similar issue was not successful in court.