The National Basketball Association has issued a stark warning to federal regulators about the growing prevalence of sports prediction markets, becoming the second major league after MLB to voice concerns about these federally regulated exchanges.
In a letter to the Commodity Futures Trading Commission (CFTC) made public Thursday, NBA Vice President and Assistant General Counsel Alexandra Roth argued that prediction markets on platforms like Kalshi, Robinhood, and Crypto.com pose significant integrity risks to the sport.
"Protecting the integrity of NBA basketball and preserving public confidence in our league and in our sport is our highest priority," Roth wrote. "That principle has guided our approach to the rise of legal sports betting in the United States and is guiding our study of the sports betting-like products replicated in sports prediction markets today."
The NBA emphasized that these markets lack the robust safeguards required of licensed sportsbooks, potentially jeopardizing game integrity. The league is particularly concerned about the rapid expansion of available contracts from season-long futures to single-game outcomes, with player proposition markets potentially on the horizon.
A key concern highlighted in the letter is the regulatory framework that allows prediction markets to launch new products without prior approval. Unlike traditional sports betting operators that must receive approval from state regulators before offering new betting markets, federally regulated exchanges can self-certify contracts and begin offering them immediately.
"Exchanges can launch new, more exotic sports prediction markets via self-certification, which puts the burden of initiating any post-launch review on the CFTC and allows most contract markets to simply proceed unchecked," Roth explained. "But for legal sports betting operators, affirmative regulatory approval from the applicable state gaming regulator is required before a new betting market can be launched in the first place."
The NBA pointed to several specific regulatory safeguards currently missing from prediction markets:
Mandatory monitoring and reporting of suspicious activity
Required cooperation with league-led investigations
Age verification and geo-blocking technology
Tools to exclude problem gamblers
Ongoing communication and data sharing with leagues
The letter specifically cited concerns about player proposition markets, particularly relevant after the NBA banned former Toronto Raptors forward Jontay Porter for life in 2024 for intentionally underperforming to benefit gamblers. Additionally, point guard Terry Rozier is reportedly under investigation for suspicious betting activity connected to a 2023 game.
NBA Commissioner Adam Silver previously described Porter's actions as "the cardinal sin" in violating league integrity rules. The NBA warned that prediction markets could eventually expand to contracts focused on "officiating decisions, league rules, or player injuries."
The comments were submitted ahead of a CFTC roundtable on prediction markets that was scheduled for April 30 but was suddenly canceled with no explanation. The regulatory agency continues to accept public feedback through its online comment portal.
Meanwhile, prediction markets continue to grow rapidly. According to industry data, sports contracts now account for 78% of Kalshi's weekend trading volume, with NBA and MLB contracts significantly outperforming any non-sports markets.
Several states—including Nevada, New Jersey, and Maryland—have issued cease-and-desist orders against sports prediction markets, prompting Kalshi to file countersuits. The company has won preliminary injunctions in at least two cases, with judges ruling that they have a "reasonable chance" of proving CFTC jurisdiction.
In its letter, the NBA clarified that it is not categorically opposed to sports prediction markets, but rather to them operating outside existing regulatory safeguards. The league has requested a role in helping shape appropriate standards should the CFTC permit these contracts to continue.
"In the event that the CFTC decides to permit the continued offering of these contracts," Roth added, "we would appreciate an opportunity to further engage with the Commission on specific regulatory provisions that can mitigate the associated integrity risks."