The NBA is talking with both Kalshi and Polymarket to arrive at a deal for prediction markets, according to Front Office Sports (FOS). Talks have accelerated, says a “source familiar with the matter,” since Michael Selig’s confirmation as Chairman of the Commodity Futures Trading Commission (CFTC), this past December. Multiple sources tell FOS that a deal could be struck before next season.

The potential terms are undisclosed, but sources say MLB’s deal with Polymarket (up to $300m over four years) could serve as precedent. Another precedent could be the NHL’s deal, which involves Kalshi and Polymarket alike. The NBA has two official partners for sports betting, DraftKings and FanDuel.

“We currently are looking at prediction markets essentially in the same way that we’re looking at sports betting markets or sports betting companies,” said NBA Commissioner Adam Silver in February, during All-Star Weekend. “It’s rapidly evolving. Prediction markets have now come on the scene fairly recently as, I don’t know how else to say it, major sports betting marketplaces. Whether prediction markets are allowed to go forward in the form they’re in now will, I think, be ultimately an issue for the courts and for Congress.” – Or else for the CFTC.

Events and swaps

According to its “advance notice of proposed rulemaking” of March 16, the agency sees event contracts as falling “within multiple subsections of the CEA’s [Commodity Exchange Act’s] definition of ‘swap.’” This includes, as per the CEA, “any agreement, contract, or transaction … that provides for any purchase, sale, payment, or delivery (other than a dividend on an equity security) that is dependent on the occurrence, nonoccurrence, or the extent of the occurrence of an event or contingency associated with a potential financial, economic, or commercial consequence.” (The CFTC points out also that event contracts traded as futures contracts do not qualify as swaps.)

Trouble is, the definition of a swap derives in part from Dodd-Frank (2010), a Congressional Act intended to deal with the credit default swaps behind the financial crisis of 2008.

A preliminary injunction ruling came down on April 6 in the case of KalshiEX v. Flaherty – Flaherty being the interim director of the New Jersey Division of Gaming Enforcement. (New Jersey is, of course, home to Atlantic City.) It finds for Kalshi and upholds the swap definition of event contracts. Never before had a federal appellate court held that the CEA preempts state gambling laws for sports-related event contracts traded on CFTC-registered designated contract markets.

Consider, though, the dissent in the case. Quoted by Fortune, it reads in part: “Basic abductive reasoning tells us that if it looks like gambling, talks like gambling, and calls itself gambling, it’s gambling.”

New Jersey has until late May to petition for a rehearing en banc.

American Indian tribes are filing lawsuits of their own, with amicus briefs from the Indian Gaming Association. Tribes in California are arguing that Kalshi and Robinhood violate the Indian Gaming Regulatory Act by offering event contracts on their tribal lands, while a tribe in Wisconsin is arguing that it holds exclusive gambling rights in the state.

Mappa mundi

Of the Big Four American leagues only the NFL has so far kept prediction markets at arm’s length, but there are signs that it won’t forever.

European football is an inverse North America. Of the Big Five only LaLiga has an official partner: Polymarket.

FIFA has sidestepped the big two, announcing on April 2 that it had signed a multiyear deal with ADI Predictstreet, a platform operating out of Gibraltar but rooted in the United Arab Emirates (UAE). The parent here is Finstreet Limited, which operates out of the Abu Dhabi Global Market (ADGM) and is itself owned by Sirius International Holding (Abu Dhabi).

Gibraltar issued on March 26 a license permitting ADI to operate as a betting intermediary. (No swap argument on The Rock.) In other words, the license was a week old when FIFA announced its deal. ADI had no announced CEO until April 8. The post is held by Dimitrios Psarrakis.

On April 13 DAZN announced that it would be integrating ADI Predictstreet as a “real-time prediction layer” into its live sports coverage; notable for the 2026 edition of the World Cup.