NFL tells Supreme Court prediction market sports contracts are gambling, not swaps

The National Football League is backing New Jersey regulators in arguing that sports prediction contracts are gambling and should not be insulated from state regulation by the federal derivatives framework.

In an amicus brief filed with the U.S. Supreme Court in Flaherty v. KalshiEX, LLC, No. 26-299, the NFL argues that contracts offered by Kalshi and other prediction markets are not financial swaps subject to the exclusive jurisdiction of the Commodity Futures Trading Commission. The league said it borrows reasoning from the Sixth and Ninth Circuits that swaps hedge preexisting financial risk traditionally, while sports contracts expose consumers to the outcome of an event in which they have no underlying financial interest.

The case could determine whether prediction markets can offer sports contracts nationwide under federal CFTC oversight or whether states can apply their own gambling laws.

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NFL Sunday drives prediction market volume

Nearly $2 billion of $3.3 billion in prediction market trading volume on the first Sunday of the NFL season was tied to NFL events, according to the league. Prediction market trading volume exceeded $25 billion in 2025, while Kalshi had cleared more than $173 billion in overall volume by late August 2026.

The NFL is asking the Supreme Court to hear the case, arguing that the growing split among courts has created regulatory uncertainty.

"It is extremely telling that the sports league which has most forcefully advocated for federal regulation is essentially saying 'this ain't it,'" gaming attorney Daniel Wallach said on X. "An important amicus brief that meaningfully increases the chances of a cert grant."

The league in March urged Kalshi and Polymarket to stop offering contracts it considers vulnerable to manipulation, including markets tied to individual plays and player injuries. CFTC Chairman Michael Selig has said the agency would defer to sports leagues on integrity concerns.

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Kalshi pushes back

The NFL also argues that prediction market operators should adopt safeguards comparable to those used by state-regulated sportsbooks, including restrictions on certain contracts, higher age limits and greater cooperation with leagues on insider information.

The NFL's position puts it at odds with other major U.S. sports leagues. MLB named Polymarket its exclusive prediction market partner earlier this year and separately partnered with the CFTC on betting integrity, while the NHL has licensing agreements with both Polymarket and Kalshi. Polymarket also signed an exclusive licensing deal with MLS in January.

Kalshi rejected the NFL's position, saying it prioritizes market integrity and that the CFTC is already policing sports-related markets. The company pointed to partnerships with other leagues and said federal oversight provides a more consistent framework than state-by-state regulation.

Intellectual property lawyer Ariel Givner similarly argued that the states and NFL are conflating the underlying sporting event with the nature of the financial contract.