Polymarket holds a reported $300 million, four-year deal as Major League Baseball’s exclusive prediction-market partner in the US and Canada.
Kalshi signed the US Tennis Association to become the exclusive prediction market partner of the US Open, whose main draw began August 30.
Roughly 20 states have filed or joined lawsuits arguing that prediction markets on sporting events are illegal gambling.
The Commercial Timeline
The partnership map has expanded fast and in a clear sequence.
The NHL partnered with both Polymarket and Kalshi in October 2025, one of the first major North American leagues to formally engage. MLS followed with an exclusive Polymarket deal in January 2026.
MLB signed its $300 million arrangement in March 2026. By August, Kalshi had secured branding deals with five individual MLB teams, bringing the total number of MLB teams with prediction-market affiliation to seven.
On August 27, Sportradar announced an expanded partnership with Polymarket covering more than 20 leagues and roughly 300,000 matches per year.
Polymarket also holds agreements with the Ultimate Fighting Championship and the New York Rangers, and expanded its partnership with Genius Sports in August.
The Legal Picture Is Far Less Tidy
Kalshi and the Polymarket US app are both federally regulated by the CFTC and are technically legal in all 50 states.
That has not settled anything. The dispute is definitional: whether an event contract on a sporting outcome is a federally regulated derivative, a state-regulated gambling product, or something between.
Arizona is pursuing criminal charges against Kalshi, alleging violations of state gambling and election betting laws.
Connecticut sued Kalshi in late August to block sports contracts, escalating a months-long fight. Texas leaders have instructed committees to investigate both platforms with a view to shutting them down, with recommendations expected in 2027.
New York, Michigan and Nevada have become significant test cases. Kalshi won an appeals ruling in April blocking New Jersey from applying state gambling law to its sports event contracts.
Courtroom outcomes across state and federal courts have been roughly split, which points toward eventual Supreme Court involvement.
The Contracts the Regulator Itself Flagged
One category is drawing scrutiny from the federal side rather than the states.
Kalshi began offering player availability markets in August and Polymarket self-certified similar contracts shortly after.
The CFTC’s Public Interest Determinations, published in March, specifically noted that event contracts related to player health raise serious public interest concerns, citing the risk of perverse financial incentives that could encourage physical harm to athletes, plus insider trading exposure.
The determination indicated that contracts settling solely by reference to the severity, occurrence or medical diagnosis of a specific player’s injury would likely be found contrary to the public interest.
Both platforms moved into adjacent territory anyway. That is the sharpest live tension between the industry and its own federal regulator.
Trust Problems on Both Sides
Polymarket has faced scrutiny over allegations involving staged or simulated social-media betting videos, a request from US senators for CFTC answers, and a consumer lawsuit over alleged deceptive marketing.
Kalshi has added compliance guardrails including employment-information checks and restrictions designed to keep politicians, athletes and other insiders out of markets where they may hold non-public information.
It also permanently banned former Representative George Santos and fined him more than $70,000, alleging misleading statements and profitable trades linked to his State of the Union attendance. That was its first permanent ban.
Why Crypto Readers Should Track This
Polymarket is reportedly planning a $1 billion funding round led by 1789 Capital that could value it near $21 billion.
Both platforms sat in the room at the White House crypto meeting in August, and the CFTC has grouped prediction markets with digital assets under a single advisory committee. Optimisus covered that structure in the piece on Washington holding two crypto meetings.
That grouping matters. Whatever preemption doctrine emerges from these state fights will shape how federal crypto regulation overrides state law generally, and Optimisus has tracked the legislative side in the CLARITY Act coverage.
Optimisus has tracked the wider regulatory squeeze in the MiCA deadline coverage.
For anyone using these platforms, the practical position is unchanged and worth restating: check eligibility, market rules and settlement terms per state before trading, because restrictions differ and are moving.
Sources
- Crypto Briefing, Polymarket faces scrutiny as prediction markets ink deals with sports leagues — https://cryptobriefing.com/polymarket-sports-leagues-prediction-markets-scrutiny/
- The Block, Kalshi and Polymarket combined volume falls 15% in August — https://www.theblock.co/news/business/2026-09-02-kalshi-polymarkets-volume-falls-august-413309
- CBS Sports, Are sports prediction markets legal, status in all 50 states — https://www.cbssports.com/prediction/news/prediction-market-legal-states/
- SBC Americas, Prediction markets weekly, August 28 — https://sbcamericas.com/2026/08/28/prediction-markets-weekly-august-28/
- Covers, Polymarket versus Kalshi, comparing promos, pricing and fees in 2026 — https://www.covers.com/betting/prediction-sites/polymarket-vs-kalshi
- Coin Gabbar, Crypto news today September 1 — https://www.coingabbar.com/en/crypto-currency-news/crypto-news-today-bitcoin-ethereum-price-september-1-2026
This is not financial advice.
Optimisus covers crypto and technology news for readers who want the detail behind the headline.
