Prediction markets site Kalshi has continued its expansion into sports betting by opening markets on college football games.
The markets appeared on site on Tuesday with 32 match winner markets, as highlighted by Dustin Gouker at The Event Horizon. The college football season does not kick off until August 23, but following the end of the NBA and NHL playoffs, the site is looking for more sports markets to keep trading volume going.
The site is also offering match winner markets on Wimbledon, which started this week.
Moving into College Football Could Spark Further Backlash
Kalshi’s March Madness markets on NCAA basketball set the ball rolling on several court cases as state regulators grew frustrated about the platform’s increasing expansion into sports. Seven states issued the company with cease-and-desist letters, claiming the markets were unlicensed sports betting.
Specifically, opening markets across all states on college football matches could be problematic. Many states place restrictions on bettors from wagering on matches that involve teams from that state.
Kalshi, however, declares that it offers “legal betting in all 50 states”. This terminology has angered state regulators and tribal leaders who filed briefs in court against the company.
A total of 34 states, plus more than 60 groups with tribal interests, signed briefs submitted in the case against Kalshi in New Jersey last month.
The briefs noted the difference in the terminology Kalshi has been using in its ads, which frequently use the term bet or betting, but in court, it has denied that it offers betting. Instead, the company claims it offers viable financial market predictions, claiming that the markets, including sports matches, have real-world financial consequences.
Sports Leagues Concerned About Prediction Markets Expansion
While the NCAA has remained relatively silent on prediction markets, pro leagues have expressed concern that the expansion could threaten the integrity of the sports. The NFL sent a letter to the Commodity Futures Trading Commission (CFTC) in August last year, voicing concern about the possibility of companies outside regulated sports betting sites offering markets on the league.
“These contracts would mimic sports betting but seemingly without the robust regulatory features that accompany regulated and legalized sports betting and which help to mitigate threats to the integrity of our contests,” wrote Jonathan D. Nabavi, NFL VP of Public Policy and Government Affairs.
Since then, the markets have expanded into almost all sports and increasingly into single-match markets, as demonstrated by the latest college football match markets.
So far, Kalshi has not yet offered any prop bets, but the NBA wrote a letter to the CFTC in May stating it was concerned that those markets will appear in the near future.
The letter stated, “The number and type of available markets are expanding at a rapid pace, with offerings now including single-game markets that allow users to wager on which NBA team will win a particular game. This expansion, which has proceeded entirely via the self
certification process, suggests to us that player proposition markets (i.e., markets focused on a player’s single-game performance) or other potential markets (e.g., markets focused on officiating decisions, league rules, or player injuries) are not far behind.”
These markets could increase the risk of players or others with insider information from exploiting the markets. The NCAA has strict rules about college athletes betting on any sport, and although it is considering loosening the rules on players betting on pro-sports, it will still enforce restrictions on players betting on college games.
In the Kalshi college markets, it is stated that “Current and former players, coaches, and staff of the league, association, or organization(s) governing the event” are prohibited from trading on the markets. However, as the company is not held to the same standards that apply to regulated sportsbooks, it is debatable how strict the company is in checking who is active in markets.
In May this year, a candidate running for California Governor managed to bet on himself in the market at Kalshi. If college players are able to do the same, then it could become highly problematic.
Adam is an experienced writer with years of experience in the gambling industry. He has worked as a content writer and editor for five years on sites such as Oddschecker, CoinTelegraph and Gambling Industry News, bringing excellent knowledge of the world of sports betting and online gambling. Adam focuses on emerging stories in the ever changing landscape of betting in the US. Read the latest on prediction markets, changing legislation, and sweepstakes.
