NFL raises concerns to Congress over growth of prediction markets

The National Football League (NFL) has warned U.S. lawmakers that the rapid expansion of prediction markets could pose risks to game integrity and consumer protections, urging Congress and federal regulators to restrict certain sports-related contracts, as reported by ESPN.

The league submitted written testimony to the U.S. House Committee on Agriculture ahead of a hearing on oversight of prediction markets by the Commodity Futures Trading Commission (CFTC). The issue comes as state gambling regulators and prediction market operators engage in legal disputes over jurisdiction and oversight.

Prediction markets, which allow trading on the outcome of events including sports, currently operate in all 50 U.S. states, while traditional sports betting is legal in 39 states and Washington, D.C., according to the NFL.

“We are particularly troubled that several sports-related futures contracts have been launched nationwide, including in jurisdictions where sports betting has not been legalized,” Jeff Miller, the NFL’s executive vice president for communications, public affairs, and policy, said in the testimony.

Miller said sports-related contracts offered through prediction markets fall outside the authority of state regulators that oversee sportsbooks, where betting activity is monitored and subject to limits set by legislators and regulators, often with input from professional leagues.

“These contracts fall outside the purview of state regulatory authorities and the safeguards they impose upon the industry,” Miller said.

The NFL also warned that the volume of money flowing into prediction markets could surpass that wagered through regulated sportsbooks, increasing the risk to the integrity of games.

The league called on Congress and the CFTC to prohibit certain types of sports-related contracts, citing examples tied to whether specific officiating or safety-related phrases are mentioned during game broadcasts.

"In each of these state-regulated markets, regulators and state legislators closely monitor betting activity and, with input from professional sports leagues, can determine which bets and wager levels are acceptable," Miller wrote. "Those guardrails do not exist in prediction markets."

“Congress and the CFTC should prohibit these and other types of objectionable bets among the many consumer and integrity protective measures needed before sports-related event contracts are legalized.”

The Coalition for Prediction Markets, which represents several major operators, disputed the NFL’s position, arguing that prediction markets are already subject to federal rules.

“This testimony is like saying the stock market has no rules,” a coalition spokesperson told ESPN. “The CFTC's regulations on abusive or manipulative trading apply to prediction markets just like the SEC's regulations apply to the stock market.”

The debate comes as traditional sportsbook operators, including DraftKings, FanDuel, and Fanatics – all partners of the NFL – have announced plans to launch prediction markets. The NHL and the UFC have also signed partnerships with prediction market companies.