The Commodity Futures Trading Commission and the National Basketball Association have signed an information-sharing agreement focused on prediction markets, placing the league among a small group of major U.S. sports organizations working directly with the federal derivatives regulator on game-integrity risks.
Under the memorandum of understanding, the CFTC and NBA will maintain regular communication and share information related to potential insider trading, market manipulation and threats to the integrity of NBA games, according to separate statements from the regulator and the league. The NBA also named Kalshi and Polymarket as its preferred prediction-market exchanges.
The deal makes the NBA the third major U.S. sports league to establish a formal MOU with the CFTC. Major League Baseball and the National Hockey League reached similar arrangements earlier this year, giving the regulator a more direct line to leagues whose games have become subjects of actively traded event contracts.
NBA joins MLB and NHL in CFTC agreements
The agreement offers a structured route for the NBA to flag suspicious activity that could be connected to non-public information, including player injuries, lineup decisions or other developments that can affect a game’s outcome before they become public.
Prediction markets let traders buy and sell contracts tied to future events, such as whether a team will win a game or whether a player will meet a statistical target. Contract prices generally move toward the market’s estimated probability of an outcome. That structure gives unusual betting activity potential value as an early warning signal, but it also creates opportunities for people with confidential information to profit before the wider public can react.
The NBA’s selection of Kalshi and Polymarket as preferred exchanges suggests the league is seeking defined compliance relationships rather than attempting to monitor an expanding and fragmented market without formal channels for communication. The arrangement does not give the league regulatory authority over those venues. The CFTC remains responsible for overseeing markets within its jurisdiction.
For the NBA, access to a standing relationship with the CFTC could make it easier to escalate concerns when trading patterns appear connected to protected league information. For the regulator, direct contact with league officials could provide context needed to assess whether unusual market activity reflects legitimate news, speculation or potential misconduct.
Federal and state authorities remain divided
The NBA agreement arrives during an unresolved legal fight over which government agencies should oversee sports-related prediction-market contracts.
The CFTC has argued that many prediction-market contracts are swaps, a category of derivatives that falls under its exclusive federal jurisdiction. States have challenged that position, arguing that platforms offering contracts based on sports outcomes may be operating in violation of state gaming laws and bypassing state tax and licensing systems.
That dispute has moved beyond a technical debate over product labels. States regulate traditional sports wagering through licensing systems, sportsbook rules and consumer-protection requirements. Prediction-market operators contend that federally supervised event contracts should not be subject to separate state gambling regimes.
New Jersey has asked the U.S. Supreme Court to consider the jurisdictional question, raising the possibility that the court could eventually set a national framework for sports-event contracts. The National Football League has added its voice to the dispute, filing an amicus brief earlier this month that characterized sports-related contracts as gambling and argued that states should retain regulatory authority.
The NFL has not signed an MOU with the CFTC. The league has instead called for stronger protections around game integrity, consumer safety and controls aimed at preventing insider trading. Its position puts it at odds with the NBA, MLB and NHL approach of establishing formal working arrangements with the federal regulator while the legal jurisdiction fight continues.
Insider-trading cases add pressure for controls
Recent enforcement matters have sharpened attention on how prediction markets can be affected by privileged information.
In April, an active-duty U.S. Army soldier was charged with using confidential information to trade on Polymarket before the capture of former Venezuelan President Nicolás Maduro, according to the criminal case. The allegations involved a political and geopolitical market rather than a sporting event, but they illustrate the central concern shared by leagues and regulators: a trader with access to unreleased information can potentially profit before public reporting changes market prices.
A separate case involved a former White House teleprompter operator who agreed to pay more than $172,000 to settle allegations that he used early access to President Donald Trump’s speeches to trade on Kalshi. The settlement similarly concerned political markets, yet the conduct alleged by regulators maps directly onto the risks sports leagues cite around unreleased injury reports, roster decisions and other sensitive information.
Kalshi and Polymarket have said they have introduced measures including employment verification requirements for traders participating in certain sensitive markets. Such measures can make it easier to identify participants whose professional roles could give them access to confidential information, though enforcement also depends on surveillance, account monitoring and cooperation with outside organizations.
Data sharing becomes a practical integrity tool
Sports integrity efforts have traditionally centered on league investigations, betting-monitoring services and regulated sportsbooks. Prediction markets introduce a different structure: their contracts can trade continuously, with prices changing as participants take positions on information and expectations.
A formal CFTC-league relationship could allow suspicious activity to be assessed alongside information the public cannot easily see, such as the timing of internal injury updates or restricted access to team personnel. A sudden price move alone does not demonstrate wrongdoing. Trading can react to rumors, public reporting, statistical models or legitimate analysis. The ability to compare market activity with league-held information is therefore likely to be central to the usefulness of the new agreement.
The NBA’s decision also places more pressure on prediction-market operators to demonstrate that sports contracts can be monitored under standards suited to a high-profile professional league. If federal courts or the Supreme Court ultimately clarify the CFTC’s authority, the league agreements already in place could become a model for how regulated event-contract venues coordinate with sports organizations.
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