The Commodity Futures Trading Commission and Major League Baseball signed an agreement on Thursday that allows both parties to enter the sports prediction market space.
The deal permits the exchange of information “concerning issues of common interest including protecting the integrity of professional baseball and the relating prediction markets,” according to the CFTC. The commission regulates the rapidly growing sports-betting industry.
The memorandum of understanding is the first of its kind between a federal agency and a professional sports league, CFTC Chairman Mike Selig announced.
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“The MOU is a collaborative step towards promoting the integrity and resilience of the prediction markets relating to professional baseball. Through this MOU, the CFTC is well-positioned to add additional tools to protect these markets and its participants from fraud, manipulation, and other abuses,” Selig said, thanking MLB Commissioner Rob Manfred for agreeing to the partnership.
The memo enables the CFTC and MLB to “more swiftly respond to incidents and better anticipate emerging trends” as prediction markets come under legal scrutiny in certain states. Both signatories confirmed their commitment to the partnership, noting they would share information in compliance with applicable law.
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Separately, the professional baseball league agreed to make Polymarket its exclusive prediction market partner.
As part of the deal, Polymarket gains access to MLB logos and data. In exchange, MLB will promote the cryptocurrency-based trading company at baseball games. The league said there will be a “comprehensive integrity framework” that prevents prediction markets from being manipulated.
MLB is the latest U.S. sports league to have an exclusive multi-year partnership with Polymarket, following the Ultimate Fighting Championship and Major League Soccer. Meanwhile, the National Hockey League has similar non-exclusive deals with Kalshi and Polymarket.
The CFTC is communicating with other sports leagues about potential prediction market partnerships, according to Selig.
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The commission is opposed to state-level regulation of the prediction market space. Last month, the chairman filed an amicus brief in federal court emphasizing the commission’s role in regulating prediction markets.
Earlier this week, Arizona Attorney General Kris Mayes filed the first-of-their-kind criminal charges against Kalshi for alleged illegal gambling in the state. The criminal charges escalate the legal battle between prediction market companies and states already occurring in Massachusetts and Nevada.
