Kalshi Targets Sports Betting Space with Super Bowl Offers

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00:00All right. Meanwhile, another platform is offering some sports outcomes. As they say,

00:04this is the same website, if I'm not mistaken, Sam, that offered bets on the presidency. Maybe

00:09I should use the bad word in bets, outcomes of the presidency too. Tell us more.

00:16Yeah, no, it's funny you mentioned what's the right word to use in this scenario. Over the

00:21past couple of years, we've talked about, are you betting on something? Are you playing a

00:25fairness of sports game on something? Or are you entering a sweepstakes contest on something? And

00:30now we're talking about, are you investing in a market or contract? At the end of the day,

00:35it's all stuff that looks very similar to sports betting. We have Kalshi, which is the latest

00:39company to come out and try to offer a product that's very similar to sports betting. But for

00:46all intents and purposes, they don't want it to be regulated as sports betting. Kalshi was,

00:50of course, the prediction market service that sparked headlines this past year for

00:56taking essentially bets on the presidential election in the form of contracts. You could

01:00buy a contract, whether Donald Trump would win or whether Kamala Harris would win. And they're now

01:05trying to get in the sports betting space. They filed with the Commodity Futures Trading Commission

01:11this week to offer markets tied to the Super Bowl, offering will team X win X, X probably being the

01:20Super Bowl. So they're preparing to offer these markets this week, start taking essentially bets

01:26or contracts on the game. And it comes just a week after Crypto.com got in kind of a similar

01:32situation. They defied the CFTC's ask to halt offering these markets while the CFTC conducts

01:39their 90-day review. Essentially, the CFTC is trying to figure out, is this sports betting?

01:45Can we say it's sports betting legally and then get these companies to then obviously be regulated,

01:51pay the fees? The reason they're doing it this way is essentially so they don't have to

01:55take all the time and go through all the hoops that companies like FanDuel and DraftKings have

01:59been doing. I'd have to imagine the companies that offer the actual regulated sports betting

02:04products would not be too happy if their competitors can simply just prop up a very

02:09similar product without similar regulations. We've had Robinhood as well say that they're

02:14exploring similar things. So it's this thing trending now where basically these things that

02:19function like stock markets, you know, Crypto.com, you invest in coins, they want you to be able to

02:23invest in the outcomes of sports. So it's kind of taking that definition of gambling and

02:29people talk about the stock market being gambling. It's what do we actually call it at the end of the

02:33day and how do we regulate it, especially when it's on a state-by-state basis.

02:37Policy is no stranger to working with the CFTC or denying the requests. This past year,

02:44they were asked to stop offering their markets on the election because technically, you know,

02:50under American law, you can't have a sports book. You can't offer, is this president going to win?

02:56Is that president going to win? It's illegal to bet on elections. But by doing it through a market

03:00system where you invest in contracts, federal appeals court said that was okay and they didn't

03:05have jurisdiction, which kind of opened up the door to this whole thing we're talking about with

03:08the pseudo sports betting space. So I think it'll be really interesting, you know, if they are able

03:14to go through and take these bets on the Super Bowl, A, how they do, B, where does the pushback

03:19come from? And then, you know, C, what do, does the actual regulated sports betting industry do

03:23about it? So definitely not the last we've heard with this story. Will be interesting to see too,

03:27if others try to follow suit.