The Baker Contract Dispute: Kalshi's Prediction Market Faces NCAA Backlash Over College Athlete Betting

The prediction market platform Kalshi has found itself at the center of a regulatory and ethical controversy after announcing plans to list contracts allowing users to bet on college athlete transfer portal decisions. While the company claimed to have sought CFTC approval for these contracts, the announcement immediately triggered fierce opposition from the NCAA and its leadership.

What Sparked the Conflict?

Kalshi submitted documentation to the Commodity Futures Trading Commission (CFTC) indicating that contracts on college athlete transfer events would begin trading starting Wednesday. These transfer portal contracts would enable users to wager on whether top college athletes would enter the transfer portal—the official mechanism through which student-athletes signal their interest in transferring to another institution.

NCAA President Baker’s Swift Response

NCAA President Charlie Baker wasted no time in condemning the initiative. On X, Baker articulated the organization’s position: “The NCAA strongly opposes college sports prediction markets.” His concerns went beyond mere philosophical opposition. Baker emphasized that student-athletes already face harassment and abuse following poor game performance, and introducing gambling on their transfer decisions would compound these pressures significantly.

Baker further argued that such betting markets “threaten the integrity of competitions and the recruiting process” while putting “even more pressure on student-athletes.” He concluded that athletes’ “decisions and futures should not be gambled on, especially in an unregulated market.”

Kalshi’s Position and Track Record

According to statements from a Kalshi spokesperson, the company initially clarified its actual intentions regarding these transfer contracts. The spokesperson revealed to The Block: “We have no immediate plans to launch these contracts.” This statement introduced an important distinction—Kalshi frequently certifies or seeks permission for potential market listings without ultimately offering them to users. Examples include contracts that would have permitted betting on animal extinction events.

Regarding the regulatory criticism, Kalshi pushed back against characterizations of operating as an unregulated entity. The spokesperson asserted: “It is inaccurate to say we are unregulated. We are a federally regulated exchange, subject to the Commodity Exchange Act and its hundreds of regulations.” According to its official documentation, Kalshi operates as a Designated Contract Market under CFTC oversight, authorized to list futures, swaps, and commodity options.

The Broader Context of College Sports Betting

This dispute occurs within a larger landscape of prediction market activity in college athletics. Both Kalshi and its primary competitor have already listed event contracts allowing users to bet on college game outcomes, particularly in football and basketball. The emergence of athlete-specific betting contracts represents an escalation that NCAA leadership views as crossing an ethical line.

The Regulatory Tension Ahead

The Baker contract dispute highlights fundamental tensions between regulatory frameworks that permit prediction markets and institutional concerns about protecting student-athletes from exploitation. Whether Kalshi ultimately proceeds with these contracts—despite its stated lack of immediate plans—remains contingent on CFTC oversight and potential NCAA advocacy efforts.