The CFTC is flagging manipulation risks in mention markets, while NCPG addresses its industry funding model amid criticism tied to prediction markets, and Kalshi’s legal battles continue to expand.
The Commodity Futures Trading Commission (CFTC) is raising the bar for prediction markets tied to public figures’ statements or actions, warning exchanges that the increasingly popular contracts may be especially vulnerable to manipulation. Meanwhile, the National Council on Problem Gambling (NCPG) said prediction markets are “functionally gambling.”
At the same time, the Mexican soccer federation sued Kalshi, and a Utah senator called for an investigation into presidential family business dealings, including Donald Trump Jr.’s prediction-market ties.
The Big Story: CFTC Warns of Manipulation Risks in ‘Mention Markets’
The CFTC has warned prediction market exchanges that certain “mention markets” present heightened manipulation risks.
In a staff advisory Tuesday, the agency’s Division of Market Oversight said that sometimes a single person or a small group can control mention markets’ outcomes. The category includes markets on whether someone will use a particular word or phrase during a speech, appear at an event or interact with another person.
The memo says that most event contracts are tied to independently generated outcomes, such as economic data, election results or regulated sports events. However, mention markets are different as their settlement depends on “the discrete conduct of a named person, and that conduct may be neither independently generated nor externally verifiable.”
As a result, CFTC staff said it may consider mention markets “presumptively readily susceptible to manipulation.” That means exchanges could face a higher bar when seeking to list them.
The advisory does not ban the contracts. Instead, it encourages exchanges to engage with the regulator “in the early phases of designing such contracts to determine if any heightened manipulation risks exist, and, if so, whether they may be mitigated with appropriate controls.”
The warning comes less than a month after the CFTC ordered former White House teleprompter operator Gabriel Perez to disgorge $107,539.02 in profits, pay a $65,000 civil penalty, and be banned from trading for three years for making profitable trades on 39 of 43 President Trump Mention contracts.
The Daily Wire
Liga MX Sues Kalshi Over Trademark Use
The Mexican Football Federation (FMF) has sued Kalshi in federal court in New York. The Federation accuses the prediction-market operator of improperly using the Liga MX trademark and the names of its member clubs.
FMF alleges that Kalshi continued to use its word marks despite multiple cease-and-desist demands, although the company removed certain logos. The operator has argued that its use was “limited to plain-text identification” in CFTC-regulated markets and denied any violations of FMF’s intellectual property rights.
Kalshi Litigation Updates in Wisconsin, Tennessee
Kalshi has asked the Seventh Circuit for permission to appeal a Wisconsin federal court decision allowing the Ho-Chunk Nation’s Indian Gaming Regulatory Act (IGRA) claims against the prediction-market operator to proceed.
The district court previously held that the Tribe could pursue IGRA claims against Kalshi. It also rejected Kalshi’s argument that the Commodity Exchange Act (CEA) or Unlawful Internet Gambling Enforcement Act (UIGEA) displaced the Tribe’s authority over the disputed activity.
Earlier this month, the court certified two questions for interlocutory appeal and stayed the underlying proceedings. Kalshi argues the issues present questions of first impression for the Seventh Circuit concerning the intersection of IGRA, the CEA and UIGEA.
Meanwhile, Tennessee submitted the Ninth Circuit decision in favor of two California tribes against Kalshi as supplemental authority in its Sixth Circuit litigation with the operator. The state argues the ruling undermines Kalshi’s position that UIGEA’s treatment of CFTC-regulated transactions prevents other federal gambling laws from applying.
Senator Seeks Probe Including Trump Jr. Prediction Market Ties
Sen. John Curtis, R-Utah, has called for the Senate Judiciary Committee to investigate business dealings involving members of the presidential family. He asked the committee to subpoena both Donald Trump Jr. and Hunter Biden.
In discussing Trump Jr., Curtis pointed to cryptocurrency ventures, international real estate and defense investments. Also, the senator pointed to what he described as his “significant financial and advisory ties to prediction market platforms,” which depend on favorable federal regulatory decisions by the CFTC.
Trump Jr. holds advisory roles with Kalshi and Polymarket and has investments in the sector.
Curtis, meanwhile, has introduced or co-sponsored legislation to ban or limit certain prediction markets.
NCPG Warns Prediction Markets Are ‘Functionally Gambling’
NCPG has issued a strongly worded warning over prediction markets. The organization says the sector’s rapid growth is exposing consumers to many of the same risks associated with traditional gambling.
NCPG Board President Derek Longmeier said the organization remains neutral on whether prediction markets should be legal. However, the NCPG believes they are “functionally gambling,” regardless of their current legal classification.
“The harm is not theoretical, and we cannot wait to act.”
The statement also addressed NCPG’s funding model, which has faced criticism over its reliance on industry contributions. Longmeier acknowledged that many of NCPG’s members and donors are gambling operators but said, “donor engagement does not mean endorsement.”
NCPG called responsible-engagement tools, self-exclusion, age verification, risk disclosures and direct access to help “minimum standards” for gambling and functionally gambling products. The organization said protections have not kept pace as prediction platforms increasingly reach younger Americans.
FanDuel Bans Bettor Featured in CBS Report
FanDuel has banned a customer featured in a CBS News investigation examining sportsbook marketing and responsible gambling practices.
Esteban Ruiz-Haynes discussed his gambling behavior and interactions with FanDuel as part of the report, which questioned how sportsbooks respond when customers suffer mounting losses.
FanDuel subsequently banned Ruiz-Haynes. The company told CBS News that it has sophisticated protections in place to spot problem gamblers.
The operator also disputed the broader characterization of its practices. FanDuel called claims that it does not aggressively monitor and address problem gambling behavior “completely false.”
Blumenthal, Tonko Join Gambling Reform Campaign
Sen. Richard Blumenthal, D-Conn., and Rep. Paul Tonko, D-N.Y., are scheduled to participate Wednesday in the launch of Truth and Integrity: The Movement for Gambling Reform in Washington, D.C.
The Public Health Advocacy Institute and Families and Friends of Gamblers organized the initiative. It calls for congressional hearings, minimum federal safety standards and stronger state regulation. Organizers say the campaign will also focus on the gambling industry’s financial relationships with professional sports, college athletics, prediction markets and technology companies.
The launch is scheduled for Wednesday afternoon at the Russell Senate Office Building.
Report Estimates €91.6B in Unregulated EU Online Gambling
New research commissioned by the Campaign for Fairer Gambling (CFG) estimates that unregulated operators generated €91.6 billion ($104.5 billion) in online gambling gross gaming revenue from consumers across the European Union in 2025.
The report, produced by Gaming Compliance International, estimates that the unregulated segment represented 72% of the €128 billion European Union online gambling market. The report estimates that unregulated gambling has increased 74% in two years.
Kevin Costner Invites Gambling, Prediction Market Leaders to Retreat
Actor Kevin Costner is seeking to bring together gambling, Tribal and prediction-market executives for a private retreat to encourage dialogue about the growing divide over sports event contracts.
Costner told InGame he offered his Dunbar Ranch in Colorado as a neutral location where representatives from all sides could discuss the issue, “share some meals and see what’s possible.” According to Costner, about 70% of those invited had responded to the proposal.
Underdog Partners With Birches Health
Underdog has partnered with Birches Health to expand its responsible-play resources and consumer-protection measures.
The agreement will integrate Birches Health resources into Underdog’s player-protection framework, including access to specialized treatment and support. The move comes as Underdog expands into the prediction market space, where some operators do not offer responsible gambling tools and protections similar to those available at regulated sportsbooks.
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