Michigan Gaming Control Board warns operators over sports event contracts

• Michigan regulators warn licensed gambling operators that offering sports event contracts through prediction markets could jeopardise their state licences
• Executive Director Henry Williams issues memorandum covering commercial casinos, sports betting operators, internet gaming providers and fantasy contest operators
• Warning extends to partnerships with prediction market entities operating in jurisdictions where regulatory bodies have objected to sports event contracts

The Michigan Gaming Control Board has warned licensed gambling operators that participation in sporting event contracts offered by prediction markets may jeopardise their state licences, even if the contracts are not available within Michigan.

Executive Director Henry Williams issued a memorandum on Friday targeting commercial casinos, internet gaming operators, sports betting operators, fantasy contest operators, and their associated licensed suppliers.

Serious warning

The warning specifically addresses operators that might partner, coordinate, or associate with entities offering sporting event contracts in any jurisdiction where regulatory bodies have objected to such offerings.

The memorandum states there could be regulatory issues with firms “partnering, coordinating, or associating with an entity that operates offers, or facilitates access to sporting event contracts in any jurisdiction other than Michigan in which a regulatory body, law enforcement agency, or other governmental authority has expressly objected to or acted in any way to prevent or cease the offering or sporting event contracts in such jurisdictions”.

Several Michigan licensees, including DraftKings and FanDuel, have stated they are considering entering the prediction market space, according to Covers intel. Some prediction markets have begun offering sports event contracts, including parlays, without state licensing or taxation requirements.

Broader regulatory concerns

The Michigan regulator previously expressed concerns to the Commodity Futures Trading Commission in April 2025, arguing that sporting event contracts are equivalent to internet sports betting wagers subject to the Lawful Sports Betting Act. Williams emphasised that such contracts expose Michigan residents to unnecessary risk and undermine public trust.

Multi-state enforcement pattern

Michigan joins Ohio in warning licensed operators about potential licence revocation for offering sports event contracts inside or outside their respective states. Several states have issued cease-and-desist orders to prediction market operators or initiated litigation against them.

The CFTC itself issued an advisory this week stating it has not approved sports-related event contracts for trading. The federal regulator warned prediction markets offering sports event contracts should prepare for state regulatory actions and potential litigation, including enforcement measures.

The regulatory pushback reflects concerns that prediction markets offering sports betting-style contracts circumvent state licensing requirements, consumer protections, and taxation systems that generate revenue for public services and responsible gaming programmes. In 2024, licensed sports betting operations in Michigan contributed over $20 million in taxes and fees.

Image source: Daniel Wallach on X.com

The Michigan Gaming Control Board has become the third state regulator, following Arizona and Ohio, to caution its licensed gaming operators against offering sports event contracts or collaborating with entities that do so within its jurisdiction.