OKLAHOMA CITY (KOKH) — Oklahoma Attorney General Gentner Drummond is urgent federal regulators to clarify that states — not the federal authorities — have authority over sports-related prediction markets, arguing the platforms perform like sportsbooks with out state oversight.
Drummond and 40 different state attorneys common filed a proper remark Thursday with the Commodity Futures Trading Commission, urging the agency to reaffirm that it doesn’t have jurisdiction over sports-related contracts provided by means of prediction markets. The coalition mentioned prediction markets have successfully turn out to be unregulated sportsbooks.
Prediction markets, together with Kalshi and Polymarket, permit customers to commerce contracts tied to the result of future occasions. Drummond mentioned sports-related contracts on these platforms quantity to playing and needs to be regulated by states.
“This is unequivocally gambling, which means it belongs under State authority,” Drummond mentioned. “States have long had the right and responsibility to protect their own citizens from the dangers of gambling, and that should continue to hold true whether bets take place on a prediction market or inside a traditional casino.”
In their letter, the attorneys common mentioned customers could make the identical kinds of wagers on prediction markets as they’ll at conventional sportsbooks. “Any distinction between sportsbook bets and prediction-market bets is illusory,” they wrote.
The coalition mentioned prediction market customers can wager on sport winners, level spreads and participant statistics, whereas bypassing shopper protections and tax necessities mandated by state playing legal guidelines. The attorneys common argued the contracts are entertainment-based playing slightly than instruments for monetary threat administration, inserting them exterior the CFTC’s jurisdiction.
The attorneys common additionally warned that sports playing poses dangers to public well being and monetary safety.
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They mentioned states are finest positioned to defend residents from these harms and requested the CFTC to affirm by means of rulemaking that it lacks jurisdiction over sports-related contracts, leaving states with the ability to regulate or prohibit sports gambling.