The NCAA sent a letter to Kalshi, a company that offers prediction markets on college basketball and football, expressing concern about the company's “commitment to the integrity of the contest and the protection of contest participants,” according to a copy of the letter obtained by ESPN.
In the letter, dated Oct. 30, NCAA Chief Legal Officer Scott Bearby asked Kalshi how he monitors college sports markets for integrity concerns and prohibited customer activity, who he considers a prohibited customer, whether he will report integrity concerns to the NCAA and whether the company will cooperate with NCAA investigations.
“We welcome Kalshi's stance in his efforts to protect the integrity of NCAA competitions and reduce instances of abuse and harassment directed at student-athletes and other participants,” Bearby wrote.
The NCAA also asked whether Kalshi would ban prediction markets similar to prop betting, which the company began offering this fall.
Prop betting markets, Bearby noted in the letter, increase “the risk of integrity concerns and harassment.” In March of last year, NCAA President Charlie Baker called for a ban on prop betting for college athletes in states with legal sports betting.
The NCAA also asked Kalshi in the letter to review language on its website that the NCAA says implies a relationship between them.
“Kalshi has strong market integrity provisions required by our status as a federally licensed financial exchange,” a Kalshi spokesperson said in a statement to ESPN. “We value the NCAA's feedback and are working to adjust the language on our site. We are currently reviewing and addressing their additional requests.”
Prediction markets like Kalshi have emerged over the past year and are competing with traditional bookmakers in the betting market. Kalshi is fighting multiple lawsuits from state gaming regulators, who allege the company is violating state laws by offering event contracts that mimic sports betting. Kalshi maintains that it is not under state jurisdiction and is instead regulated by the Commodity Futures Trading Commission, a federal agency.
In March, Kalshi announced a partnership with IC360, an integrity monitor used by many collegiate and professional leagues.
The NCAA has faced an increasing number of alleged betting violations by players in recent years. In September, the NCAA announced that a Fresno State men's basketball player had manipulated his performance for betting purposes and conspired with two other players in a prop betting scheme. In total, the association has opened investigations into possible betting violations by approximately 30 current or former men's basketball players.
