Polymarket Secures Exclusive Prediction Market Partnership with MLS

Original | Odaily Planet Daily (@OdailyChina)

Author | Azuma (@azuma_eth)

January 27, local time in the United States,The commercial division of Major League Soccer (MLS), Soccer United Marketing (SUM), has announced a multi-year partnership agreement with the prediction market platform Polymarket.According to the agreement, Polymarket will become the official and exclusive prediction market partner for the MLS regular season, MLS All-Star Game, MLS Cup, and the Leagues Cup in North America. In return, MLS will require Polymarket to use official league data and third-party integrity monitoring systems, and prohibit the platform from offering betting markets on events the league deems susceptible to manipulation or involving insider information.

This is not the first time a sports league has partnered with a prediction market. As early as last October, the National Hockey League (NHL) reached multi-year licensing agreements with both Kalshi and Polymarket. Later in November of last year, Polymarket also entered into an agreement with the Ultimate Fighting Championship (UFC), becoming UFC's official and exclusive prediction market partner.

What is meant by the term "official exclusive prediction market"? Does this imply that unauthorized platforms will no longer be able to offer related betting markets in the future? What impact will this have on future industry competition?Although there are currently limited mature cases and observable samples in the market for predicting sports events, we can find similar answers in the sports betting market, which offers a service effect very similar to that of prediction markets.

• Odaily Note: For more information on the similarities in services between prediction markets and sports betting, as well as the differences in regulation, and the regulatory tug-of-war surrounding prediction markets, please refer to our article from two weeks ago, "..."Tinkering with the multi-billion-dollar gambling industry, the prediction market is now being pursued by the old order.》.

First, let's answer the most important question —— Does the existence of an exclusive authorization mean that other unauthorized platforms will not be able to open related betting markets in the future?

The current state of sports betting is that since the U.S. Supreme Court struck down the federal Professional and Amateur Sports Protection Act (PASPA)—which had previously prohibited commercial sports betting—on May 14, 2018, individual U.S. states have gained the authority to independently decide whether to legalize sports betting within their jurisdictions. In other words, the legality of sports betting services now depends on state-level licensing, not on commercial authorization from sports leagues. In reality, when bookmakers set odds or provide betting services for various legal sports events, they do not necessarily need to obtain commercial authorization from the league operators.

However, in a few states such as Tennessee, state-level sports betting regulators require betting companies to use official league data when offering in-play betting services, unless they can demonstrate that the data is inapplicable or unavailable.This means that official authorization practically affects the service scope of betting companies—only those authorized to access the data can provide the most comprehensive betting services.

But this logic does not currently apply directly to predicting the market.For prediction markets, given the current regulatory framework is still unclear (and objectively more lenient), platforms like Polymarket and Kalshi are not obligated to follow requirements similar to those in gambling regulations before the final ruling from the appellate court, and potentially the Supreme Court, is determined.

So although Polymarket currently has an exclusive license from MLS, at least for now, this does not necessarily mean that other platforms like Kalshi are prohibited from offering MLS-related betting markets.

Although it is not strictly "mandatory to obtain authorization to open betting," in actual commercial operations, there are indeed numerous business collaborations and licensing agreements between major sports leagues and gambling companies. For example, the NFL has signed a long-term cooperation agreement with Genius Sports, authorizing Genius as the sole official data provider to license real-time match data to gambling companies. This data includes lineups, match reports, technical statistics, and more.

For betting companies, the main significance of authorization lies in their ability to directly obtain official data and brand licensing from sports event organizers through commercial agreements, thereby enhancing their service quality and user experience.If it is an exclusive authorization, an additional layer of exclusivity effect can be added on this basis.

The most essential significance here naturally lies in the quality and integrity of the data. Compared to data scraping through third-party channels,Official data obtained through licensing agreements will inevitably be more accurate, timely, and comprehensive. This directly impacts the improvement of betting odds accuracy, accelerates settlement efficiency, and expands the range of betting options.As for authorization at the brand and trademark level, it allows the betting companies to be more flexible in promoting related betting markets—using the logos of leagues, teams, and players while avoiding the risk of infringement.

Conversely, for sports events, directly reaching authorization agreements with betting companies can help reduce the possibility of market manipulation (which may sound a bit abstract at first). Both parties can standardize betting scopes and share abnormal betting data to promptly identify potential manipulation risks. For example, in the collaboration between Polymarket and MLS, both sides have clearly specified that betting markets on items easily subject to individual manipulation—such as red and yellow card decisions—or those involving insider information, like coach dismissals and player transfers, cannot be offered.

Given the high overlap in service effects between prediction markets and sports betting, the significance of licensing agreements in the sports betting market will also apply to prediction markets.

Sports betting has long been proven to be a large and steadily growing business. Within prediction markets, sports events have gradually become the category with the highest trading volume.

Dovey Wan, founder of Primitive Ventures (@DoveyWanYesterday, I posted the proportion of betting turnover for different types of events in several major prediction markets. Among them,The betting volume for sports-related events on Kalshi has exceeded 90%, and the betting volume for sports-related events on Polymarket has also reached 43%. — Obviously, sports events have become a core source of traffic for these two leading prediction markets.

In the face of a large existing market size and clearly visible growth potential, competition is inevitable. Currently, among the four major U.S. sports leagues, only the NHL has already signed licensing agreements with Kalshi and Polymarket, while the NFL, NBA, and MLB remain in a wait-and-see position. It is expected that after Polymarket has successively secured exclusive rights from UFC and MLS,The two leading platforms, Kalshi and Polymarket, which hold significant compliance and capital advantages, are likely to engage in even more intense competition in the future, particularly around securing authorization for various top-tier sporting events. As a result, more exclusive agreements will inevitably emerge.

However, the data also reveals another interesting phenomenon—perhaps due to cultural differences and user habits, emerging prediction markets on the other side of the world are taking distinctly different and divergent paths.As shown in the previous figure, the proportion of event streams related to native cryptocurrency markets is significantly higher than that of Kalshi and Polymarket. While the market leaders are directly competing for the large pie of sports events, second-tier projects might find opportunities to catch up by taking a more unconventional or niche approach.