Major League Baseball has come full circle concerning its opinion on prediction markets, and its recent partnership agreement highlights how it has morphed from cautious to consenting, reflecting a growing acceptance of these platforms in the sports-betting industry.
Integrity First
Major League Baseball announced a partnership agreement with Polymarket, one of the leading prediction platforms. The major factor in welcoming Polymarket on board and signing a Memorandum of Understanding with the CFTC is to ensure that integrity protocols are adhered to, in which the MLB can maintain control as to what is and what is not agreeable to offer on the prediction markets’ MLB sports event contracts.
“The new agreements that we formed with Polymarket and the CFTC are imperative steps in proactively managing the new and rapidly growing prediction market space,” MLB Commissioner Rob Manfred said in the release. “Protecting the integrity of the game on the field is our top priority. By engaging in this community, we are able to work together to create clear boundaries with the goal of mitigating risk while providing fan engagement opportunities.”
Polymarket and its partners can now utilize MLB logos and trademarks in their prediction products. Sportradar’s official MLB data can also be used by the exchange to settle its baseball contracts.
The announcement states that Polymarket is the MLB’s only partner in the category but “intends to have integrity relationships with all other prediction market exchanges offering baseball contracts.”
Prediction Markets Becoming Entrenched
The prediction markets appear to be garnering support from the Commodity Futures Trading Commission (CFTC), the federal agency that licenses them, which, not long ago, had taken a hands-off approach to the topic of their licensees offering sports event contracts.
However, that has recently changed since Michael Selig has taken over as the newly installed commissioner. He has become increasingly vocal regarding his support for prediction markets venturing into the world of sports event contracts.
His stance and the legal victories that prediction markets have already racked up against states’ attorneys general and gaming commissions issuing cease-and-desist letters have prompted many to reconsider their previous narrative regarding prediction markets and their place among the sports betting landscape, once exclusively dominated by sportsbooks.
MLB Changes Its Tune
It was only a year ago when Major League Baseball expressed its concerns regarding prediction platforms in the sports betting space. “Any expansion of betting markets, particularly those outside of the established regulatory framework, raises serious questions about game integrity and oversight,” MLB said.
But a year has passed, and Major League Baseball has now decided to work with the prediction market industry to ensure policies and protocols are being followed. This is another indication that stakeholders believe the prediction markets are more likely to be here to stay rather than be chased away by upcoming adverse legal rulings.
Kalshi Still Faces Legal Risk
Yet, a Nevada federal court judge recently imposed a temporary restraining order against another industry leader, Kalshi, for 14 days until a new hearing is held. Many believe the ultimate verdict won’t be rendered unless the US Supreme Court decides to hear the case and determine whether the federal authority of the CFTC can supersede that of the state gaming commissions.
