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The debate over whether prediction markets constitute sports wagering, which is currently playing out in several court cases, developed another dimension courtesy of America’s pastime.
Major League Baseball issued a memo to all the league’s players – including the Philadelphia Phillies and Pittsburgh Pirates – instructing players not to participate in prediction markets involving baseball outcomes and events, according to a report from Front Office Sports.
That publication revealed that MLB Commissioner Rob Manfred and the players’ union jointly sent a memo to players, dated Aug. 26, entitled “Re: Baseball Related Prediction Markets.”
The memo mentioned prominent prediction markets by name.
“Several companies (including Kalshi, Robinhood, and Crypto.com, among others) are now offering what they call ‘prediction markets,’ which allow members of the public to risk money on the outcome of specific events, including baseball and other sporting events.”
Memo has been out for four months
The Front Office Sports report also noted that the memo, despite its circulation to players in August – including posting the memo near locker rooms where they could be seen, per two separate Major League Baseball team sources – still has not fully circulated.
The story said that three MLB players on different teams “were still unaware of the memoʻs existence or any league or union-led conversations informing players about potential prediction-markets rule violations.”
The memo reminded players of MLB’s longstanding policy against sports wagering, which is being tested by a recent case involving Cleveland Guardians pitchers Emmanuel Clase and Luis Ortiz.
Congress comments on MLB scandal
Per ESPN’s coverage, the pitchers were indicted in an alleged betting scheme that has attracted attention from Congress.
Members of the Senate Committee on Commerce, Science and Transportation, the committee overseeing professional sports, dubbed the allegations as “markedly more serious” than other recent betting issues embroiling pro baseball.
Clase and Ortiz are facing trial in May on federal charges that they took bribes to help gamblers who wagered on their pitchers. Per a recent ESPN story providing an update on the case, the duo “accepted thousands of dollars in bribes to help two unnamed gamblers in their native Dominican Republic win at least $460,000 on bets placed on the speed and outcome of their pitches.”
NHL treats prediction markets differently
Not all pro sports are uniform in their prediction market stances. The National Hockey League, for instance, has forged partnerships with both Kalshi and Polymarket, which includes access to proprietary data and the right to use NHL logos on their platforms, according to Front Office Sports.
According to that report, NHL Commissioner Gary Bettman said “the agreements were made in part because the league thinks it’s important for fans to know that event contracts are ‘based on real data.’
“More importantly, it gives us control, because we have the ability to take down any contracts we don’t think are appropriate.”
An ESPN report noted that the NHL also has partnerships with 10 sportsbooks in the US and Canada. NHL President of Business Keith Wachtel said the deals are win-win.
“The handle in sports is growing for the sportsbooks. We believe the rising tide is lifting all boats here.”
The prediction markets give fans of the Philadelphia Flyers and Pittsburgh Penguins a new way to tie outcomes to potential financial gains besides Pennsylvania sports betting – even in states where sports betting is still illegal.
