The Weekender: CFTC and Prediction Markets and a Radical OSB In MA

A look back at a wild week for the CFTC and a look ahead to a wild new bill in Massachusetts that would radically change the state's sports betting law.

The Bulletin Board

• ABOVE the FOLD: A look at the biggest story of this week and next.

  — LOOK BACK: The CFTC against the world.

  — LOOK AHEAD: MA bill would overhaul existing sports betting law.

• HOUSEKEEPING: Podcasts, featured articles, and more from yours truly.

• PAID SUBSCRIBER BONUS: An excerpt from STTP Consulting’s The Forecast, a premium subscription service that provides quarterly reports and weekly updates on the US online gambling sector

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Look Back: Tensions Rise Between CFTC and Prediction Markets

The CFTC featured in every newsletter last week, so I’ll just repost a summary of my handy-dandy wrapup from Thursday:

Good News: The resignation of CFTC chair Rostin Behnam, who has voiced numerous concerns about prediction markets. The incoming Trump administration will pick the next CFTC chair and is expected to be friendly to prediction market and crypto companies.

Bad News: Analysts believe the federal government will step in and take action against illegal and unregulated gambling products, including quasi-gambling products. As STTP has been warning, federal action is coming.

Good News: Donald Trump Jr. was named as a strategic advisor to Kalshi, which Chris Grove called the cake being baked: “Looking forward to a rush of CFTC-mediated sportsbooks led by Kalshi, Robinhood, and Crypto.com (followed by some state-based legal challenges, probably with NY at the vanguard), the return of Polymarket to the U.S. market, and a bunch of too-late-to-the-party startup decks in 2025.”

Bad News: The CFTC announced a review of Crypto.com’s sports markets and requested the company suspend the markets until the review is complete. Crypto.com responded to the request by saying (h/t Geoff Zochodne).

I’d add that the Kalshi-CFTC legal battle is also in its next phase in the US Court of Appeals for the DC Circuit.

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Look Ahead: MA Bill Radically Changes Sports Betting Law

As I first noted on X on Friday, a new bill filed by State Sen. John Keenan (with the backing of the PHAI, the group behind the federal SAFE Bet Act) would add numerous “safeguards” to the current sports betting laws.

The bill would:

• Increase the current tax rate from 20% to 51%

• Prohibit in-play and prop bets

• Set wagering limits ($1,000/day, $10,000/month max) without affordability check

• Creates affordability checks and limit wagers to 15% of a patron’s bank account

• Prohibits ads during televised sports events

• Eliminates compensation based on a patron's wagering

• Adds bonuses, SGPs, and more to unfair and deceptive practices

This week, STTP will examine the new bill more closely and offer insight into its chances of passing (slim to none) and its impact on the overall landscape.

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Housekeeping

PODCASTS:

• John Pappas, a public affairs and government relations expert and founder of Corridor Consulting, was this week's guest on the Talking Shop Podcast. We discussed the successes of sports betting legislation and the failures of online casino legalization efforts.

COLUMNS:

• This week’s featured column examines the looming threat of federal action in 2025.

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