New York Attorney General Letitia James speaks to the media, after she attended a hearing and pleaded not guilty to charges that she defrauded her mortgage lender, outside the U.S. District Court for the Eastern District of Virginia, in Norfolk, Virginia, U.S., Oct. 24, 2025. Jonathan Ernst | ReutersDays before Super Bowl 60, New York Attorney General Letitia James has a message for consumers: Be careful about placing trades on prediction markets.”New Yorkers need to know the significant risks with unregulated prediction markets,” James said in a statement Monday. “It’s crystal clear: so-called prediction markets do not have the same consumer protections as regulated platforms. I urge all New Yorkers to be cautious of these platforms to protect their money.”Prediction platforms like Kalshi and Polymarket are expected to generate billions of dollars in trading volume around the Super Bowl. Consumers can make trades on game events — similar to online sportsbooks like DraftKings or FanDuel — as well as on predetermined outcomes, such as which companies will advertise during the Super Bowl, an issue CNBC Sport reported on last week. James said the platforms’ products are bets “masquerading” as event contracts, which are generally regulated by the Commodity Futures Trading Commission. Kalshi, which initially declined to comment, said in statement later Monday, “We agree that consumers should steer clear of unregulated prediction markets. Our members’ platforms are all regulated by the CFTC, similar to how the SEC regulates the stock market. Regulation comes with many of the guardrails the AG outlines – a ban on insider trading, self-exclusion, and responsible trading guidelines. We all want the same thing: safe, fair, and legitimate products.”Representatives for Polymarket didn’t immediately respond to request for comment. Get the CNBC Sport newsletter directly to your inboxThe CNBC Sport newsletter with Alex Sherman brings you the biggest news and exclusive interviews from the worlds of sports business and media, delivered weekly to your inbox.Subscribe here to get access today.James warned that concerns around the nascent prediction market industry include “upholding prohibitions against insider betting and requiring regulatory review to ensure the financial stability and integrity of gambling operators.””Prediction markets may appear as modern, high-tech platforms for speculation or ‘forecasting,’ but in practice, many operate as unregulated gambling without the basic protections New York consumers both deserve and expect from properly licensed operators,” James said in the statement.Prediction market contracts trade somewhat similarly to all-or-nothing options, with contracts priced between $0 and $1. The contracts trade up or down depending on the action. In addition to contracts on Super Bowl commercials, both Polymarket and Kalshi are offering other trades related to the game, including on matters like “What songs will be played at the halftime show?,” “Who will attend the big game?,” and more traditional sportsbook “bets” …
