The New York State Gaming Commission (NYSGC) is considering whether current licensees should be allowed to operate if they participate in prediction markets. Speaking at a Nov. 18 meeting, NYSGC Chair Brian O’Dwyer said such markets pose a “direct threat to the commission’s authority, as well as to the regulated gaming industry.” Two major licensed sportsbooks have announced plans to offer prediction market contracts, while two daily fantasy sports operators already provide them via partnerships with Crypto.com and Kalshi.
“Given the dangers of prediction markets to both the state of New York and its citizens, it is now appropriate that this commission examine whether the participation of any of our present licensees in so-called prediction markets makes them unfit to maintain their gaming license,” O’Dwyer told commissioners. “Our general counsel and staff shall examine this and make recommendations to this commission for the future.”
Several state regulators, including those in Arizona, Nevada, and Ohio, have warned operators that participation in prediction markets could jeopardize their in-state licenses. While New York has not issued a formal notice, O’Dwyer emphasized that all licensees must be “of unblemished character and of the utmost fitness.” In October, the commission sent a cease-and-desist to Kalshi, prompting ongoing litigation.
Prop Betting Under Scrutiny
The NYSGC is also reassessing sports betting props amid integrity concerns linked to MLB and NBA scandals. O’Dwyer said staff have been instructed to re-examine all game-specific player props and same-game player prop parlays, with findings to be reported back to commissioners.
“While limiting exposure is a good step, it may not be enough,” O’Dwyer said. “It is not enough. If we believe any wager is susceptible to manipulation, we will eliminate it, not restrict its offering.” The commission plans to send letters to all 70-plus leagues on which it allows wagers, asking them to suggest any restrictions on betting.
In an initial review of the 104 NFL prop bets approved in New York, staff identified only one that could potentially raise concerns. O’Dwyer noted that props may be more vulnerable to manipulation than standard team- or game-outcome bets and could appeal to underage or problem gamblers.
Operators Enter the Prediction Market Space
FanDuel and DraftKings, New York’s largest licensed sportsbooks, are preparing to launch geolocated prediction market apps in the state. Daily fantasy sports operators Underdog and PrizePicks have already introduced sports contracts through partnerships with Crypto.com and Kalshi, respectively, shortly after receiving New York DFS licenses.
The NYSGC chair also criticized prediction markets for allowing bets on sensitive political matters, citing an example of wagering on the potential deportation of New York’s incoming mayor, Zohran Mamdani. “If this is a joke, it’s not funny,” he said, calling such bets “racist” and “special, unwanted attention.” He added that federally regulated prediction markets do not have provisions for underage or problem gamblers, raising further concerns about their involvement by licensed operators.
Source:
“New York regulator will reassess licenses of prediction market participants”, sbcamericas.com. November 19, 2025
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