The NFL is taking a cautious approach when it comes to establishing partnerships with prediction market operators, prioritizing stronger regulations and safeguarding game integrity.
In a recent interview with CNBC, Commissioner Roger Goodell stated that the NFL is engaging in discussions with prediction markets to outline what these companies can do to potentially form a partnership with the valuable U.S. sports league in the future.
“We’re continuing to have conversations with them and talk to them about the things that we think they need to do to strengthen that so that they could be potential partners at some point in the future,” the commissioner told the financial news network.
While the NHL has formed partnerships with the two largest prediction markets, with Major League Baseball (MLB) and other leagues following suit, the NFL and the NBA have been hesitant to embrace prediction markets due to concerns about gaming integrity.
NFL Seeks Robust Regulations
After the repeal of the Professional and Amateur Sports Protection Act (PASPA) in 2018, the NFL quickly made deals with gaming companies. However, these companies are regulated by the states they operate in, while prediction markets are federally regulated by the Commodity Futures Trading Commission (CFTC). The NFL aims for more stringent oversight of this emerging industry.
“We’ve been really clear about that, and it’s not a surprise, I think, for anybody. We think that there needs to be stronger regulations into the prediction markets,” Goodell told CNBC. “We want to see that to protect the integrity of our game. We want to make sure we’re protecting the consumers that are on those platforms for the NFL.”
With annual revenue of $23 billion and growing, and an average estimated franchise value of as much as $10.36 billion, the NFL has the economic luxury of slow-playing prediction market relationships.
Prediction Markets Advised to Avoid Questionable NFL Contracts
To gain favor with the NFL, prediction markets should steer clear of event contracts that the league identifies as objectionable or susceptible to manipulation and insider trading. These include derivatives related to player injuries and referees’ calls.
Prediction market operators can opt not to offer these event contracts, and if the CFTC does not interfere, the derivatives can go live. Recently, Novig announced that it will not provide “easily manipulable, inherently objectionable, officiating-related, and knowable in advance” event contracts on NFL games