NHL Pact With Kalshi, Polymarket Adds Pressure on Sports-Betting Companies

BY ALEXANDER OSIPOVICH

The National Hockey League has reached licensing agreements with predictionmarket startups Kalshi and Polymarket, boosting their efforts to disrupt traditional sportsbook operators such as DraftKings and FanDuel.

The league announced the multiyear deals Wednesday after they were first reported by The Wall Street Journal. By entering the agreements, the NHL becomes the first major U.S. professional sports league to allow the use of its trademarks by prediction markets.

Such upstart trading platforms have encroached on the turf of established gambling companies by offering “event contracts” on games that are similar to traditional sports bets. The incursion of prediction- market startups into sports has sparked an outcry from gambling-industry groups and legal challenges from state regulators.

Despite those court battles, Kalshi has enjoyed record volumes in recent weeks thanks to the start of the National Football League season and a partnership with brokerage Robinhood Markets. As a federally licensed exchange, Kalshi offers its sports event contracts in all 50 states, even those that restrict betting on standard sportsbooks.

Since Sept. 29, when Kalshi launched a product similar to same-game parlays and Robinhood announced surging volumes in sports contracts, DraftKings shares have slumped 18%, while shares of FanDuel parent Flutter Entertainment have dropped 11%. A parlay is a single bet that combines two or more wagers, such as betting on the outcomes of two separate games.

So far, Kalshi has avoided using trademarked terms such as “NFL” or “Super Bowl” on its app and website. Instead, it uses terms such as “Pro football champion” and refers to teams by their cities. The NFL and other leagues have long been vigilant about potential infringement of their intellectual property.

With the NHL deal, both Kalshi and its rival Polymarket got the league’s green light to use its logo, terms such as “NHL” and “Stanley Cup,” and names of individual teams. The NHL has similar agreements in place with sportsbook operators such as DraftKings, FanDuel and BetMGM.

“Prediction markets are here to stay,” said Keith Wachtel, president of NHL business. Partnering with Kalshi and Polymarket could help the league expand its fan base to the tech-savvy users of prediction markets, he added. Wachtel said sportsbooks remain “important partners” of the NHL.

Earlier this month, the New York Stock Exchange’s parent company agreed to invest up to $2 billion in Polymarket, led by CEO Shayne Coplan, in a boost to the startup’s plans to relaunch in the U.S. in the coming months.

Polymarket was forced to stop serving Americans in a 2022 settlement with the Commodity Futures Trading Commission. It acquired a small CFTC-regulated exchange in July. The exchange, now called Polymarket US, plans to list contracts on sports and elections, regulatory filings show.

Bill Miller, president of the American Gaming Association, called the NHL’s deals with Kalshi and Polymarket “deeply concerning.”

“Contrary to the league’s claims, the future of these platforms is far from certain, evidenced by the legal pro-ceedings in multiple states, the views of well over half of the nation’s attorneys general, and state regulators determining these platforms to be illegal,” Miller said in a statement.

Several state gaming commissions have argued that Kalshi is flouting state laws and exploiting a loophole in financial regulations to offer sports betting nationwide. Casino operators and Native American tribes have raised concerns that prediction markets’ foray into sports threatens their revenues.

Kalshi says that its markets aren’t subject to state law and that only its regulator, the CFTC, can block it from listing sports event contracts. So far, Kalshi has fought back at--tempts by the states to restrict it from offering sports wagers. Some legal observers expect the fight ultimately will reach the Supreme Court.

For decades, the CFTC sought to maintain a strict separation between gambling and financial trading. But a federal court ruling last year allowing Kalshi to offer election bets paved the way for prediction markets to push the envelope on the kinds of contracts they offer.

Under President Trump, the Republican-led CFTC has done little to prevent Kalshi from launching sports contracts, and the administration has been receptive to prediction markets.

Trump’s son Donald Trump Jr. is an adviser to both Kalshi and Polymarket.

Established sportsbooks have taken steps to adapt to the rise of prediction markets. DraftKings said Tuesday that it had acquired Railbird Technologies, which owns a CFTClicensed exchange, as part of a strategy to enter prediction markets. In August, FanDuel joined with exchange operator CME Group to develop a trading platform similar to Kalshi’s.

CME could list sports event contracts if the federal government makes it clear that they are legal, Chairman and Chief Executive Terrence Duffy said during a Wednesday earnings call. “I won’t sit on the sidelines,” he said.