The Massachusetts Gaming Commission (MGC) has issued a strict warning to sports wagering operators, signaling that partnering with prediction market platforms or offering sports event contracts in the state could jeopardize their licenses. The move underscores the growing tension between state regulators and the emerging prediction market sector.
In a letter to licensees, the MGC noted, “The (MGC) is aware that several Massachusetts sports wagering licensees are considering or have begun the process of partnering with entities in the prediction market space to begin offering event wagering contracts.” The notice prohibits offering such contracts directly or through affiliates, as well as directing customers to platforms providing these services.
The Legal Framework Behind the Ban
Under Massachusetts law (M.G.L. c. 23N), only licensed sportsbooks may offer wagering on sports events. The statute defines a “sports event” as “a professional sport or athletic event, collegiate sport or athletic event, a collegiate tournament, motor race event, electronic sports event or other event authorized by the [C]ommission under [Chapter 23N].” The MGC emphasized that prediction market contracts fall outside this scope and therefore cannot be offered in Massachusetts.
The letter warned operators that noncompliance could result in “steps up to and including revocation of your license,” and noted that regulatory action in other states could influence future licensing decisions in Massachusetts. Licensees are required to respond in writing within ten business days, outlining measures to comply with the notice.
National Context: States and Legal Battles
Massachusetts is not alone in addressing prediction markets. At least eight states, including Arizona, Illinois, Michigan, Nevada, and Ohio, have sent cease-and-desist letters to Kalshi, a leading prediction platform, arguing that its contracts constitute unlicensed gambling. Kalshi maintains it operates under federal oversight from the Commodity Futures Trading Commission and has filed lawsuits against New York, Maryland, Nevada, New Jersey, and Ohio regulators.
Attorney General Andrea Campbell previously filed suit against Kalshi in Massachusetts to halt sports event markets. Tribes have also pursued litigation, claiming prediction market operators violate the Indian Gaming Regulatory Act by offering contracts on tribal land.
Sportsbooks Move Forward Despite Restrictions
Despite regulatory warnings, major sportsbooks are preparing to enter the prediction market space. DraftKings plans to become the first major operator to offer sports event contracts, while FanDuel intends to launch similar products in states without legal sports betting. Both operators view prediction platforms as an opportunity to reach markets such as California and Texas, where traditional sports betting remains restricted.
The MGC’s letter makes it clear that Massachusetts licensees cannot participate in these markets, yet leaves the possibility open for future regulatory developments. “This notice shall not be construed as the Commission waiving any rights with respect to future determinations related to prediction markets and event contracts,” the letter reads.
By taking this stance, Massachusetts joins a growing chorus of states asserting control over sports wagering, highlighting the complex intersection of state law, federal oversight, and innovative betting platforms that aim to reshape the landscape of sports gambling.
Source:
“Massachusetts prohibits sportsbooks from offering sports prediction markets”, massgaming.com, November 13, 2025
