Massachusetts Issues Stern Warning To Sportsbooks About Prediction Market Plans

Massachusetts has grow to be the newest to state to warn sports activities betting licensees about getting too deep into the prediction markets enterprise.

In a letter to operators, Massachusetts Gaming Commission govt director Dean Serpa writes, “Please settle for this letter as discover that you’re prohibited from providing sports-related occasion contracts in Massachusetts, immediately or by way of an affiliate, associated enterprise entity, or different affiliation, or directing patrons to such occasion contracts being provided in Massachusetts. …

“In the occasion you supply sports-related occasion contracts in Massachusetts or direct patrons to such occasion contracts being provided in Massachusetts, the Commission could take steps as much as and together with revocation of your license.”

Sportsbooks have been served related notices in Ohio, Arizona, Michigan, Illinois and Nevada.

The relevance of the warnings has heightened during the last week, as DraftKings and FanDuel – by far the highest two revenue-producing sportsbooks within the US – have unveiled plans to supply sports activities occasion contracts on new prediction markets platforms. These plans, although, are just for states the place sports activities betting is just not authorized.

PrizePicks, which is licensed in Massachusetts as a DFS operator, additionally just lately introduced its prediction markets intentions by way of a new partnership with Polymarket.

Is Nevada First Domino?

While FanDuel and DraftKings preserve their sports activities occasion contracts won’t be accessible in authorized sports activities betting states, Massachusetts’ letter suggests regulatory sanctions in different states could carry over to the Commonwealth.

“To the extent another regulator takes motion towards your license as a consequence of your operation within the prediction market area, such motion could inform choices associated to your suitability in Massachusetts,” Serpa writes.

This portion of the warning is in keeping with gaming lawyer and lobbyist Bill Pascrell III telling DeFi Rate just lately, “Once you get a license stripped in a single state, it has a deleterious impact in different states.”

Nevada, in truth, has taken motion towards FanDuel and DraftKings, though neither operator is licensed as a cellular sportsbook within the Silver State. And it seems they gained’t be any time quickly.

In a notice to licensees dated yesterday, Wednesday, Nov. 12, the Nevada Gaming Control Board indicated FanDuel has surrendered its license as an info service supplier and that DraftKings has withdrawn its software for a sports activities betting license.

FanDuel operates the retail sportsbook on the Fremont Hotel & Casino in Las Vegas. DraftKings opened a 90,000-square foot workplace in Vegas in March 2023.

Mass Fighting Prediction Markets on Multiple Fronts

Prediction markets are in Massachusetts’ crosshairs.

Multiple states, together with New York, Nevada, New Jersey, Maryland, Ohio, Illinois, Montana and Arizona, have despatched cease-and-desist letters to Kalshi, which in flip has sought preliminary injunctions to halt enforcement of the C&Ds. Massachusetts selected a distinct path by initiating a lawsuit towards the corporate.

These states all make the identical case, nonetheless: Kalshi is appearing as an unlawful sportsbook of their jurisdictions.

As DraftKings and FanDuel push additional into prediction markets, they’re risking placing themselves in the identical bucket.

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