Former New Jersey Governor Chris Christie has warned that rapid growth of sports-related prediction markets poses legal, economic, and ethical risks, arguing the platforms undermine state authority and threaten the integrity of professional and amateur sports.
Key Takeaways
- Christie said sports-related prediction markets operate illegally and should be shut down.
- He argues the model weakens consumer protections, threatens sports integrity, and reduces state tax revenue.
- The dispute over federal and state authority is likely to end up at the Supreme Court, according to Christie.
Speaking with CNBC's Contessa Brewer, Christie said prediction markets are operating illegally across the U.S. while bypassing consumer safeguards built into state-regulated sports betting systems.
Christie said the expansion of these markets have accelerated in jurisdictions with limited oversight or explicit prohibitions, creating uneven enforcement and exposing bettors to unregulated products.
"(Prediction markets' model) is bad for the integrity of sport, it's bad for consumer protection, it hurts tax revenue in states, and, bottom line, it's against the law, and they need to be stopped," Christie said.
He rejected claims by companies such as Kalshi that federal oversight by the Commodity Futures Trading Commission (CFTC) exempt them from state gambling laws. Assertions that the CFTC regulates sports betting activity are inaccurate and misleading, he said, noting federal derivatives oversight was never intended to cover wagers tied to sporting outcomes.
Christie also highlighted potential corruption risks, pointing to emerging contracts linked to whether college athletes will enter the NCAA transfer portal. He said those products create incentives that could be easily manipulated, including scenarios where athletes might be paid to alter career decisions
for betting purposes.
According to Christie, state-regulated sportsbooks offer monitoring and league cooperation mechanisms that are lacking in prediction markets. He added that legal challenges are ongoing and expects the issue to ultimately reach the U.S. Supreme Court.
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Christie takes role with AGA
Christie recently joined the American Gaming Association (AGA) as a strategic adviser, where he has taken on a leading role in opposition to the expansion of CFTC-regulated sports event contracts.
His appointment comes amid growing friction between licensed sportsbooks and prediction market operators offering contracts tied to sporting outcomes, which led to sports betting and iGaming operators FanDuel and DraftKings ending their memberships with the association.
Christie agrees with the AGA’s opinion that contracts concerning sports events are, in effect, the same thing as standard sports bets, which state gaming laws should regulate. When asked why he is actively challenging prediction markets, Christie reiterated that a lack of state regulation leads to an absence of consumer safeguards.
