CFTC and NHL sign a data-sharing agreement as focus on integrity grows

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The Commodity Futures Trading Commission (CFTC) has been increasingly looking to secure partnerships with major leagues, and specifically focusing on the exchange of data, in a bid to bolster transparency and the game’s integrity. These deals come at a time when prediction markets are an increasingly popular choice for placing what, if not a wager, then is at least a trade on the outcome of an event.

CFTC continues to work with sports leagues to strengthen integrity, prevent manipulation

The CFTC has been aware of fears raised over the integrity of prediction markets and whether insider information has been used to manipulate trades in favor of people with private knowledge of events. By signing the latest agreement with the National Hockey League (NHL), the CFTC hopes to put these fears away to an extent and strengthen its commitment to ensuring a transparent and level playing field for consumers who choose to engage in prediction markets. The official press statement outlines a Memorandum of Understanding under which terms, the CFTC and the NHL will enhance their information-sharing and coordination when it comes to the integrity of professional hockey and related event contracts. The move should affect all CFTC-regulated exchanges, as noted. I’m proud the CFTC and NHL have officially signed an MOU, furthering the agency’s commitment to improve data sharing between professional sports leagues and the Commission, added CFTC Chairman Michael S. Selig. He noted that the present partnership constituted an important step forward in protecting the integrity of sports and ensuring that there are no instances of fraud, abuse, and insider trading. Integrity has always been and remains paramount to the NHL and fundamental to the trust our fans and partners place in our game, added NHL Commissioner Gary Bettman. Insider trading has been a veritable concern among prediction market platforms and critics. Polymarket, for example, was abused by insiders to profit from events related to geopolitical action.

Insider trading remains an associated fear for prediction markets

U.S. lawmakers have criticized these outcomes, arguing that by having insiders with confidential information trading on prediction markets, foreign adversaries could be informed ahead of events, endangering American lives. Just recently, Rep. James Comer, Chair of the House Oversight and Government Reform Committee, announced that he has petitioned the CEOs of Polymarket and Kalshi, requesting information about ongoing efforts to prevent insider trading. Polymarket has been quick to act and has indeed helped identify instances of insider trading, including in the case of a U.S. Army serviceman who used his privileged knowledge to place wagers, fetching him a six-figure payout. Our agreement with the CFTC enhances the comprehensive integrity monitoring systems already in place and strengthens our ability to identify, deter, and address potential risks. This MOU reflects a shared commitment to transparency, oversight, and protecting the integrity of the game, Commissioner Bettman added.