The US Commodity Futures Trading Commission (CFTC) and the National Basketball Association (NBA) have agreed to work together on monitoring prediction markets, seeking to strengthen safeguards against insider trading and protect the integrity of professional basketball.
The agreement establishes a framework for sharing information about market activity that could affect the fairness and credibility of NBA competitions. The memorandum of understanding was signed by CFTC Chairman Michael Selig and NBA Commissioner Adam Silver.
As prediction markets expand their presence in professional sports, the partnership reflects growing efforts to address concerns over the use of confidential information and the potential for market manipulation.
Kalshi and Polymarket Get NBA’s Backing
The NBA has named Kalshi and Polymarket its preferred prediction market exchanges, saying the partnerships introduce safeguards designed to limit the types of markets available to participants.
“Protecting the integrity of the game is our top priority,” said Scott Kaufman-Ross, the league’s head of media distribution and partnerships.
He said cooperation between regulators, market operators and sports organisations would be important as the sector develops, adding that the agreements could create new ways for fans to engage with basketball while maintaining appropriate protections.
The NBA is now the third major North American sports league to establish a partnership with prediction market platforms, following similar moves by Major League Baseball and the National Hockey League.
Betting Scandals Add Pressure for Stronger Safeguards
The agreement comes against a backdrop of gambling-related controversies in professional sports. Recent investigations have led to lifetime bans in the NBA and other criminal cases, including a federal probe into illegal gambling that resulted in more than 30 arrests last year.
Prediction market operators such as Kalshi and Polymarket maintain that their services function as trading platforms rather than traditional betting operations. That distinction, however, has become a central point of disagreement between regulators and several state governments.
The NFL has supported a request asking the US Supreme Court to review a dispute over whether states should have authority over sports-related prediction market contracts.
The NBA permits players to promote gaming companies under certain restrictions, but they cannot promote betting markets tied to NBA competitions. Players may participate in broader brand campaigns and promote markets connected to sports outside the league. Several prominent athletes, including four-time NBA Most Valuable Player LeBron James, have commercial arrangements with prediction market platforms.
Regulatory Fight Over Prediction Markets Continues
The CFTC maintains that prediction markets fall under its authority because they involve trading in financial instruments. The agency reiterated that position in the agreement with the NBA.
Several states have challenged the regulator’s approach in court, arguing that sports-related prediction contracts amount to gambling and should therefore be governed by state betting laws.
The dispute leaves the industry facing an unsettled regulatory landscape, even as major sports organisations begin forming formal relationships with market operators.
Beyond basketball, prediction market platforms are also expanding into other sporting events. Kalshi has partnered with the US Open tennis tournament, while the men’s ATP Tour has entered into a similar arrangement with Polymarket.
The NBA-CFTC agreement marks another step in bringing prediction markets closer to mainstream professional sports. Whether these partnerships can adequately address concerns about fairness, insider information and competing regulatory powers will remain a key test as the industry grows.
