Published on: February 2, 2026, 04:01h.
Updated on: February 2, 2026, 04:01h.
- She warns prediction markets lack essential protections similar to those established in regulated betting environments.
- James highlights that prediction markets function as largely unregulated gambling platforms.
In a timely consumer advisory issued just days ahead of Super Bowl LX, New York Attorney General Letitia James (D) cautions residents in the Empire State about the potential dangers linked to prediction markets.
In her consumer alert, James emphasizes that platforms offering event contracts do not provide consumer protections and operate outside the regulations of the New York State Gaming Commission (NYSGC). Instead, these prediction market operators fall under federal regulation by the Commodities Futures Trading Commission (CFTC).
“Ahead of the Super Bowl, New Yorkers must be aware of the substantial risks presented by unregulated prediction markets,” stated the attorney general in her alert. “It’s abundantly clear: these so-called prediction markets lack the consumer safeguards provided by regulated platforms. I urge all New Yorkers to exercise caution with these platforms to safeguard their finances.”
The Super Bowl stands as the most bet-on event in the U.S., with analysts suggesting that prediction market operators may take a notable share of the bets usually held by traditional sportsbooks during this year’s marquee NFL event.
James Challenges the Prediction Markets Sphere
Given its rank as the fourth most populous state and its status as the largest in terms of a competitive sports wagering market, New York regularly records the highest betting handle of any state, contributing millions to state revenue.
Recent statistics reveal that despite significant activity on platforms like New York-based Kalshi, the regulated sports betting handle in New York has not materially decreased. Nevertheless, James continues to caution event contract platforms about their increasing resemblance to what many experts define as sports betting.
In her consumer advisory, the attorney general alerted prediction market companies that their advertising and promotion of offerings resembling sports betting could conflict with New York gaming laws and result in civil or criminal actions. She also criticized the industry for presenting itself as a viable investment alternative when, in her opinion, it represents merely another form of wagering.
“While prediction markets may seem like modern, high-tech platforms for speculation or forecasting, in practice, many operate as a form of unregulated gambling that lacks the essential protections New York consumers both deserve and expect from properly licensed entities,” noted the alert.
Kalshi and New York in Legal Conflict
New York joins an extensive list of states taking legal or legislative action against prediction market companies. Last October, the NYSGC issued a cease-and-desist order to Kalshi for allegedly providing an unlicensed sports betting product.
In response, Kalshi initiated a countersuit, arguing its federal regulatory status—a strategy it has leveraged in various states, though it faces challenges at the state level.
Furthermore, Massachusetts recently issued Attorney General Andrea Campbell (D) a preliminary injunction against Kalshi, a decision that the NYSGC has used as supporting authority in its ongoing case against the event contracts firm.