The National Football League has formally submitted a set of recommendations to the Commodities and Futures Trading Commission on the regulation of sports-related prediction markets. The guidance was delivered in a letter from Brendon Plack, senior vice president for government affairs and public policy for the NFL, to CFTC Chairman Michael Selig as the commission proceeds with a rulemaking process addressing these markets.
In the letter, the league urged the CFTC to prohibit event contracts that it views as susceptible to manipulation by a single individual. Examples singled out include wagers on whether a kicker will miss a field goal and whether a quarterback's first pass will be incomplete. The NFL argued such markets could be easily influenced by isolated actions.
The league also sought limits on contracts tied to outcomes it described as "knowable in advance," such as the first play of a game. Alongside those categories, the NFL called for restrictions on betting markets connected to events it labelled "inherently objectionable," specifically citing contracts tied to player injuries.
Plack's letter requested a ban on so-called "mentions" contracts involving broadcasters. These contracts allow market participants to place wagers on particular words or phrases a broadcaster might say during a telecast. The NFL said those offerings should be prohibited.
On participant eligibility, the NFL recommended raising the minimum age to participate in sports-related prediction markets to 21 years old. The letter framed this as aligning prediction market age rules with typical online sports betting requirements. The NFL noted that, at present, prediction market platforms permit users to begin trading at age 18.
To bolster oversight and enforcement, Plack suggested using state-level gambling regulations as a model for guardrails around sports-related prediction market contracts. He recommended the National Futures Association enter into arrangements with state gaming regulatory authorities to enable data sharing and strengthen enforcement mechanisms.
The league asked that prediction market platforms agree with sport governing bodies to produce and enforce lists of prohibited participants for sports event contracts, explicitly including league employees among those who should be barred from relevant markets.
In addition, the NFL advocated prohibiting margin trading on prediction market platforms. The letter argued that allowing event contracts that are not fully collateralized - particularly in sports markets - could increase addictive behavior and the risk of loss. "The permittance of event contracts that are not fully collateralized, as some have suggested, particularly related to sports markets, could amplify addictive behavior and loss risk," Plack wrote.
Key points
- The NFL has formally requested the CFTC to ban contracts it deems easily manipulable and to restrict markets tied to knowable or objectionable events.
- The league seeks a higher minimum age of 21 for market participants and a prohibition on broadcaster "mentions" contracts.
- The NFL wants stronger cooperation between prediction market platforms, sport governing bodies and state gaming regulators, and a ban on margin trading for these contracts.
Risks and uncertainties
- Regulatory uncertainty - Ongoing CFTC rulemaking means final rules and timelines are unclear, affecting prediction market platforms and operators in the gaming and fintech sectors.
- Compliance and enforcement - Implementing data-sharing agreements between the National Futures Association and state gaming regulators may be complex and could impact enforcement effectiveness across markets and jurisdictions.
- Operational impacts on platforms - A ban on margin trading and stricter participant screening, including age increases and prohibited-participant lists, could materially change platform operations and market liquidity for sports-related contracts.