NYC Council Probes Prediction Market Marketing

Jonathan Rodriguez

Written by: Jonathan Rodriguez

Published: Fri Aug 14, 2026, 8:00 am ET

Read Time: 4 minutes

NYC Council Probes Prediction Market Marketing

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New York City Council Speaker Julie Menin is leading an investigation into four major prediction market platforms over alleged deceptive and predatory marketing practices. 

Menin, a City Council member and former Commissioner of Consumer Affairs, is seeking information from Polymarket, Kalshi, Coinbase, and Gemini Titan about their advertising and operations. 

The inquiry adds to New York's growing scrutiny of prediction markets as they expand into sports and other event contracts, putting them in closer competition with traditional US online sportsbooks.

New York City Council Investigates Prediction Market Advertising Practices

Menin sent letters to the four companies on August 11, requesting extensive information about their business and marketing activities. The requests contain more than 60 questions covering users, revenue, demographics, advertising, and influencer campaigns. 

Additionally, the NYC Council also wants information about New York customers dating back to January 1, 2025, including how much residents have won or lost on these platforms. Officials are also examining payments to influencers and the effectiveness of promotional campaigns.

Polymarket faces particular scrutiny following reports about its influencer marketing and promotional content. A Wall Street Journal investigation alleged that some creators promoted trades without risking their own funds. 

Those reports also raised concerns about marketing aimed at younger adults and potentially minors, adding to broader questions about how prediction markets present financial risk to consumers.

Menin emphasized those concerns in a statement.

"Prediction markets aggressively entice consumers to bet and wager on sports, politics, culture, weather, and pretty much anything. We refuse to let New Yorkers, especially our young people, become collateral damage." Menin said in a statement. 

"I intend to harness the full power of the Council to protect New Yorkers from deceptive and predatory marketing practices by prediction market platforms."

The companies have 14 days to respond to the Council's requests. After reviewing their responses, officials could hold public hearings or pursue additional consumer protection measures, depending on what the investigation uncovers.

New York City Steps Up Consumer Protection Efforts

The Council's investigation focuses on advertising practices rather than determining whether prediction markets constitute gambling. 

Instead, officials are examining whether these platforms market their products responsibly and provide adequate safeguards for consumers.  Specifically, the NYC Council is probing if prediction markets' ads target younger people and those vulnerable to gambling-related harm. 

The inquiry could lead to stronger consumer protections, public education initiatives, or additional enforcement measures.

The investigation could also influence broader New York gambling policy as prediction markets continue expanding across the city. If the Council identifies significant shortcomings, its findings could encourage other major cities to examine how prediction market companies advertise their products and target consumers.

New York Regulators Continue Their Legal Battle Against Kalshi

The advertising investigation comes as Kalshi faces an escalating legal battle with New York officials. Attorney General Letitia James sued Kalshi on July 31, alleging that its prediction market operations violate state gambling laws. 

The state wants to prevent Kalshi from offering contracts to New York residents while seeking financial penalties and other relief.

Kalshi disputes those allegations and argues that federal law governs its event contracts. The company maintains that the CFTC has exclusive jurisdiction over its federally regulated markets. 

Kalshi also suffered a setback when Judge Analisa Torres denied its request for a preliminary injunction against New York regulators, finding that the company had not shown federal commodities law preempted New York's gambling statutes.

The legal conflict has continued as federal and state authorities take opposing positions. The CFTC later intervened following New York's enforcement action, exercising emergency authority involving Kalshi's operations. 

New York has also sued Coinbase and Gemini over their prediction market offerings, with James alleging that both platforms operate unlicensed gambling businesses within the state.

Potential Impact on Prediction Markets

The NYC Council investigation could create consequences well beyond New York City as prediction markets face growing regulatory pressure nationwide. These platforms already face numerous lawsuits concerning sports-related contracts.  

Meanwhile, state regulators continue challenging their operations and federal regulators defend their authority over event contracts.

A city investigation focused on advertising could add another layer of scrutiny as prediction markets expand their customer bases. Companies may face pressure to strengthen influencer disclosures, age safeguards, and oversight of promotional campaigns. 

The findings could encourage other cities to investigate prediction market advertising, particularly as sports contracts become increasingly prominent.

Prediction Markets vs Sportsbooks

That development could further complicate competition between prediction markets and established US online sportsbooks. 

For regulators, the investigation could help clarify how consumer protection rules should apply to emerging event-based financial products. For prediction market operators, it could establish new expectations for advertising practices across major markets.

Ultimately, the Council's inquiry does not determine whether prediction markets are legal gambling platforms. Instead, it examines whether their marketing practices adequately protect New Yorkers from potentially deceptive or predatory promotions. 

The findings could become an important test for prediction market advertising standards and influence future legislation as these platforms continue expanding across the United States.

Jonathan Rodriguez
Jonathan Rodriguez

Jonathan is an avid basketball fan, and is often looking forward to the next upcoming NBA season when not checking players' stats during games. He also likes to keep his ears on the ground for the latest rumblings in the online casino industry.

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