Major League Baseball (MLB) has called on the U.S. Commodity Futures Trading Commission (CFTC) to implement an integrity framework for sports event contracts, citing concerns over a lack of regulatory oversight for prediction markets that increasingly resemble traditional sports betting.
In a letter dated March 7 to CFTC Acting Chair Caroline D. Pham, MLB Executive Vice President of Legal & Operations Bryan Seeley urged regulators to apply the same integrity protections to exchanges like Kalshi and Crypto.com as those imposed on sportsbooks.
“As the resemblance between sports event contracts and traditional sports betting markets continues to grow, so too does the need to replicate the integrity and consumer protections that exist at the state level,” Seeley wrote.
MLB raised concerns that current CFTC rules do not require betting exchanges to notify leagues of potential integrity threats, share data on suspicious activity, or cooperate in investigations related to match-fixing or insider betting.
“MLB has been advised that some exchanges and brokers take the position that they are not even permitted to share information with MLB under current CFTC regulations,” Seeley noted.
While Kalshi currently offers limited markets, including wagers on American League, National League, and World Series champions, the company has informed the CFTC of plans to expand into single-event betting and prop wagers—bet types that carry heightened integrity risks, MLB argued.
MLB’s letter comes amid heightened regulatory scrutiny of sports event contracts, which allow users to trade outcomes of sporting events like financial derivatives.
Last week, the Nevada Gaming Control Board (NGCB) issued a cease-and-desist order to Kalshi, instructing the exchange to stop operating in the state by March 14. Nevada regulators argued that sports and election markets are unlawful in the state unless licensed as gaming by the Nevada Gaming Commission.
The CFTC is currently conducting a 90-day review of the legality of sports event contracts, which began on Jan. 25.
As reported by Dustin Gouker in The Closing Line, CFTC counsel has submitted the Nevada cease-and-desist letter as evidence in the commission’s federal court case against Kalshi, which centers on the exchange’s political betting markets.
A Kalshi spokesperson responded to MLB’s concerns, signaling openness to collaboration with leagues.
“We appreciate MLB’s comments and look forward to working in partnership with all of the leagues,” the spokesperson said. “As a highly regulated futures contract operator, we have a shared desire to ensure transparency, integrity, and data sharing.”
The company emphasized its commitment to providing “safe, regulated, and transparent prediction markets.”
MLB is the first major sports league to directly intervene in the debate over sports event contracts, underscoring the growing tension between traditional gaming regulation and emerging prediction markets.
Original article: https://www.yogonet.com/international/news/2025/03/11/97818-mlb-urges-cftc-to-establish-integrity-safeguards-for-sports-betting-exchanges
