The Commodity Futures Trading Commission (CFTC) sued Kentucky, Kalshi sued Illinois for similar reasons, and DraftKings finally launched its own prediction markets exchange, and so much more happened this week.
As ever, SBC Americas rounds up some of the biggest stories you may have missed from the world of event contracts in our latest Prediction Markets Weekly.
MLBPA asks for player prop markets ban
ESPN betting reporter David Purdum and MLB guru Jeff Passan jointly reported on Thursday night that the Major League Baseball Players Association (MLBPA) has asked for player prop-style event contracts to be banned, as part of a wider plea to crack down on player prop betting.
Purdum and Passan cited a source who said that during collective bargaining negotiations, the players’ union proposed that it should band together with the league itself to lobby for a ban on betting on individual players’ performances on state-regulated sportsbooks, daily fantasy operators, and CFTC-regulated prediction market platforms.
But, at the same time, said ESPN, the MLBPA asked the league to allow players to strike endorsement and sponsorship deals with legal betting operators, as well as prediction markets. Maybe you can have your cake and eat it too after all.
Biden-era Solicitor General backs PMs in court
In a rather unexpected twist in the litigation saga, former Biden administration Solicitor General Elizabeth Prelogar is prediction markets’ latest court champion.
Prelogar has been retained as an attorney by the Coalition for Prediction Markets, which includes the likes of Kalshi and Crypto.com. She filed what Coinbase Chief Legal Officer Paul Grewal called “a masterpiece” of an amicus brief in the Sixth Circuit Court of Appeals this week to advocate for the companies’ right to offer event contract trading nationwide under federal regulation.
The Sixth Circuit case in question is a consolidated case that essentially amounts to Kalshi vs. the states of Ohio and Tennessee after those two separate court cases were combined at the appeals level. Earlier this year, a District Court judge ruled in favor of the Ohio Casino Control Commission in that lawsuit, but a different judge granted Kalshi temporary relief against Tennessee officials.
“Prediction market operators do not have the same incentives or pursue the same business strategies as sportsbooks,” wrote Prelogar, who also argued that state gaming regulators are ill-equipped to deal with regulating financial products.
We have some (small) Congressional bill movement
There are a lot of prediction market bills in Congress right now, but movement has been scant. However, this week, the House Administration Committee voted to advance a piece of legislation that would ban members of Congress and their families from trading on elections and other political and government policy-related contracts.
The committee split a 5-4 vote in favor of moving the Stop Lawmakers From Predicting Act forward in the chamber, the first time a House body has given the green light to a bill designed to restrict how U.S. politicians can trade on prediction markets. Republican members said yes, and Democrats said no, reportedly due to their feelings that the bill does not go far enough.
The caveat here is that the sponsor of the bill, Wisconsin Republican Bryan Steil, is the Chair of the Administration Committee. Still, the fact that a GOP committee felt motivated to approve it suggests that there is potentially some small momentum behind the idea of implementing federal legislative restrictions.
Back in April, the Senate amended its rules to ban senators and their staff from participating in any prediction markets, not only political and policy contracts. That was an internal rule change rather than a legislative ban.
Zuckerberg wants in on the gold rush?
Everything is gambling nowadays, and Facebook and Instagram parent company Meta wants in on the prediction markets craze.
The New York Times reported this week that Mark Zuckerberg’s company has begun developing an experimental, AI-led prediction market app “similar to Polymarket and Kalshi” that will begin with free play only. The name Facebook Marketplace is already taken by that app’s buy-and-sell platform, but who knows where this could lead. Instagram Predicts?
For now, we’ll defer to The Event Horizon’s Dustin Gouker’s headline assessment of this news: “Exactly What No One Asked For.”
WSJ’s big Polymarket exposé
New York-based national outlets have been busy. As well as the NYT’s Meta report, the Wall Street Journal published a story based on a deep investigation into Polymarket’s advertising practices, which found that the company paid online content creators to produce videos that allegedly falsely suggested customers won a total of $1.9m.
Most of the videos featured fake trades that were conducted on sites mocked up to look like Polymarket. The WSJ said it was all part of a ploy to lure users to its non-U.S. offshore platform. The Journal reported that 118 videos showed “Polymarket users” winning almost $900,000, when the actual bets they “made” would have collectively lost them more than $166,000.
Polymarket later told CBS News that it is “conducting a comprehensive audit of active promotional content to ensure it complies with our standards, as well as applicable regulatory and legal disclosure requirements.” In the meantime, the company continues to stretch the notion of the phrase “there’s no such thing as bad publicity” to its limits. It’s just another week.
Kalshi could launch IPO, says Mansour
Finally, Polymarket’s eternal rival / court friend Kalshi is considering opening an Initial Public Offering, its co-founder and CEO Tarek Mansour said this week. It won’t happen in 2026, but next year is a possibility.
“A company of our financial profile with the rate of growth that we’re seeing, that sort of conversation has to happen,” Mansour told CNBC.
Meanwhile, the Financial Times claims that Kalshi is ready to open a funding round that could value the company at $40bn. This comes on the heels of reports that the company set another monthly trading record of $17.9bn in May.
