Football Season to Test Whether Prediction Markets Are Cannibalizing Regulated Sportsbook Handle
NFL and college football seasons are underway as prediction markets post record $5 billion trading volume over opening weekend. New York mobile handle fell 15.3% year-over-year to $1.73 billion while the AGA forecasts the first NFL betting stall since 2018. The coming months will measure the competitive impact on taxed sportsbooks.
SCCG Take — CFTC-regulated prediction markets create clear regulatory arbitrage that threatens state tax receipts and licensed operator margins. Policymakers and sportsbooks must evaluate corrective measures before the erosion becomes entrenched.
The NFL regular season and ongoing college football schedule are expected to clarify how far prediction markets have cut into regulated sports betting. These platforms began offering trading on events involving sports outcomes in 2025 and have since faced industry claims of poaching customers through unregulated competition.
The American Gaming Association anticipates legal NFL betting volume will stall this year for the first time since 2018. Bill Miller, the group’s president and CEO, called the platforms “backdoor sports betting” and said they are “dangerously misleading … by marketing sports wagers as an investment.” The prediction markets fall under Commodity Futures Trading Commission oversight rather than state gaming rules, as first reported by Casino.org News.
Declines Hit Key State Betting Handles
New York, the largest sports betting state, recorded $26.3 billion in total handle for 2025. That produced $2.55 billion in operator revenue and $1.32 billion in state tax collections. Mobile handle last month fell to $1.73 billion, a drop of $313 million or 15.3% from $2.04 billion a year earlier. It was only the second year-over-year monthly decline in state history.
New Jersey has posted a nearly 4% handle reduction through July. While some softening was expected after the World Cup lifted earlier figures, the timing coincides with rising prediction market activity that escapes state taxes and fees. Distinguishing temporary fatigue from competitive displacement will require sustained data.
What Football Season Will Reveal
Prediction market volume hit a record during the NFL opening weekend, with more than $5 billion in sports contracts traded across the two days. That figure, compiled by TicketTracker, represents the highest two-day total in the sector’s short history.
The risk is that these tax-exempt alternatives continue to divert activity from licensed operators, shrinking state revenues in markets such as New York. Early season metrics will show whether the reported declines reflect isolated pullbacks or the start of broader erosion. Operators and regulators will need to track the numbers closely to determine if policy adjustments are required to address the uneven regulatory footing.
Reporting: Casino.org News
Generated by SCCG’s automated editorial system from published source reporting. SCCG Management holds editorial responsibility.
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