Polymarket faces scrutiny as prediction markets ink massive deals with sports leagues

Prediction markets and professional sports leagues are getting very cozy, very fast. Polymarket locked down a $300 million, four-year deal as Major League Baseball’s exclusive prediction-market partner in the US and Canada back in March 2026, and that was just one domino in a chain that now stretches across multiple leagues and platforms.

The problem: roughly 20 states disagree with the premise that these platforms are anything other than gambling operations wearing a fancier hat. The collision between rapid commercial expansion and state-level legal pushback is shaping up to be one of the more consequential regulatory fights in both sports and finance.

The partnership blitz

The timeline of deals tells a clear story of acceleration. The NHL partnered with both Polymarket and Kalshi in October 2025, making it one of the first major North American leagues to formally embrace prediction markets. MLS followed in January 2026 with an exclusive deal with Polymarket. Then MLB went big in March 2026 with that $300 million exclusive arrangement.

By August 2026, Kalshi had carved out its own niche, securing branding deals with five individual MLB teams. Combined with Polymarket’s league-level partnership, that brings the total number of MLB teams with some form of prediction-market affiliation to seven.

On August 27, 2026, Sportradar announced an expanded partnership with Polymarket covering more than 20 leagues and approximately 300,000 matches per year.

The regulatory minefield

The legal picture is considerably less tidy than the partnership map. Approximately 20 states have filed or joined lawsuits against Polymarket and Kalshi, arguing that prediction markets on sporting events constitute illegal gambling under existing state laws.

The core dispute boils down to a definitional question that sounds simple but isn’t: is a contract that lets you bet on whether the Yankees will win the World Series a “prediction market” regulated by the CFTC, or is it a sports wager regulated by state gambling commissions? The platforms say the former. A growing coalition of state attorneys general say the latter.

Polymarket and MLB tried to get ahead of the integrity question by signing a memorandum of understanding with the CFTC alongside their partnership announcement. The MOU focuses on information sharing and market integrity, essentially giving the federal commodities regulator a formal role in overseeing prediction-market activity tied to baseball outcomes.

Why leagues are betting on prediction markets

There’s also a data monetization angle. Sportradar’s expanded partnership with Polymarket, covering 300,000 matches annually across more than 20 leagues, creates a massive pipeline of real-time data flowing between sports organizations and trading platforms. Leagues get paid for providing official data. Platforms get the credibility of “official” status and access to proprietary statistics that can power more sophisticated markets.

What to watch

Kalshi’s team-level branding strategy is worth monitoring separately. While Polymarket has pursued league-wide exclusivity, Kalshi’s approach of signing individual teams creates a different kind of market presence, one that could prove more resilient if league-level deals face legal challenges.

The CFTC’s role is the biggest wildcard. The agency has historically taken a cautious approach to event contracts, particularly those tied to sporting outcomes. Its willingness to formalize oversight through the MLB MOU suggests a shift toward accommodation rather than restriction.