MLB Reportedly Warned Players About Prediction Markets in August Memo

Major League Baseball reportedly warned players this summer that prediction markets are off-limits, saying that players who risk money on baseball outcomes through event-contract exchanges, such as Kalshi or Polymarket, would be violating league gambling rules, according to a copy of the memo obtained by Front Office Sports.

On these exchanges, users can risk money on baseball outcomes as well as other sporting events. While Kalshi and Polymarket claim their markets are not a form of gambling, the memo shows MLB takes a different view. 

The August memo, with the subject line: “Re: Baseball Related Prediction Markets,” was sent out to the major and minor leagues and displayed in areas where players could see it. However, some players told Front Office Sports they hadn’t seen the memo and hadn’t been told about the league’s stance on prediction markets. 

“Several companies … are now offering what they call ‘prediction markets,’ which allow members of the public to risk money on the outcome of specific events, including baseball and other sporting events,” the memo read. The memo makes it clear that “participating in ‘prediction markets’ to risk money on any outcome related to baseball games or events” is prohibited under MLB policies.

The league’s warning comes as Kalshi makes inroads in mainstream media. Last week, both CNBC and CNN signed multi-year partnerships with the exchange, which will bring real-time event forecasting into news programming. At the same time, Polymarket briefly took the No. 1 spot among free sports apps in the Apple App Store after its founder appeared on 60 Minutes.

Prediction Market Memo Sent Two Months Before MLB Players Were Arrested

MLB sent the memo out to players just two months before the baseball world was shaken by news that Cleveland Guardians pitchers Emmanuel Clase and Luis Ortiz had been indicted on federal charges of manipulating in-game outcomes for betting purposes. 

As things stand, jury selection is set for May 4, 2026, but new developments could still change the court calendar. The indictment accuses the two pitchers of rigging individual pitches, including throwing balls outside the strike zone, sometimes on the very first pitch of an at-bat. Behind the scenes, bettors were profiting to the tune of hundreds of thousands of dollars. 

If convicted on all charges, the pair could be looking at up to 65 years in prison and be banned from MLB for life. In the aftermath of the high-profile arrests, MLB moved quickly to restrict betting on pitches, working with its sportsbook partners to cap wagers at $200 and ban pitch-level bets from parlays.

The league also came under congressional scrutiny, with members of the United States Senate Committee on Commerce, Science, and Transportation sending a letter referencing a “new integrity crisis” and demanding answers about why the conduct went undetected for two years. 

The case has triggered some of the most serious integrity questions the league has faced since the Pete Rose era, raising concerns about whether modern betting markets and insider information have compromised the fairness of baseball and other sports.

MLB Sees Risk as Prediction Markets Gain Ground

MLB’s actions seem to be a way to insert a pre-emptive guardrail as prediction markets continue to gain traction among the public. In the memo, the league expressed concerns that, unlike regulated sportsbooks, prediction-market operators have no obligation to alert leagues to suspicious bets or provide access to integrity data, according to MLB. The league argues that this gap could make it harder to detect potential manipulation.

While MLB has taken a hard line on prediction markets, the NHL recently entered into multi-year partnerships with Kalshi and Polymarket, but has not publicly clarified how its player gambling policy applies to those platforms. Like MLB, the NFL has said prediction markets mimic sports betting and has banned players from using them. The league has also said it will hold off on entering prediction markets until the regulatory landscape becomes clearer.