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Who Raised the Alarm About Sports Trading
The National Basketball Association has sent a letter to the Commodity Futures Trading Commission expressing worries about sports event contracts trading. These products let punters trade based on match outcome predictions.
Available to anyone 18+ in all US states, these markets are offered by platforms like Kalshi, Crypto.com and Robinhood.
Since appearing on Crypto.com late December, they’ve gained good traction. Kalshi racked up more than £300 million from March Madness markets alone, Business Insider reports.
Why The NBA’s Got The Jitters
The basketball organisation specifically highlighted the “rapid expansion” and changing nature of these contracts. What began as season-long bets has morphed into single-game markets.
This shuffles uncomfortably close to what many reckon is unauthorised sports betting. But without the proper oversight.
The NBA fears these platforms lack the “sports-specific” regulatory scrutiny that state gambling authorities provide. Game integrity could be at risk without proper safeguards that have become standard in regulated betting.
What The NBA Is Asking
In its letter, the NBA questioned the CFTC’s self-certification process. This setup lets companies tick their own compliance boxes before launching products.
No requirement exists for platforms to flag dodgy trading patterns to leagues. Or cooperate with investigations. They don’t have to share information with affected leagues either.
The NBA isn’t alone in these worries. Major League Baseball made a similar plea to the CFTC in March, pushing for an “integrity framework” like those in states with legal betting.
How The Rules Might Change
The NBA suggested that if these contracts continue, the CFTC ought to adopt comprehensive regulations similar to state betting markets.
Currently, the system dumps the “burden” of after-launch reviews on the CFTC. Meanwhile, loads of markets go completely unchecked. Quite different from legal betting, where operators need state approval first.
This request comes just after Sporttrade, a betting exchange, asked the CFTC for nationwide access. They offer a similar product but operate as a betting service in just five states.
