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Sports event contracts have some similarities with sports bets, but they fall under federal jurisdiction. States are currently in a regulatory tug-of-war over the burgeoning market.
Prediction markets were once an esoteric novelty, but now they’re becoming a serious competitor for your sports dollar. According to Pew Research Center, combined trading volume on the two largest prediction exchanges jumped from around $26 billion in May to $53 billion in July 2026, driven primarily by sports trading during the World Cup. Pew also found that Americans wagered around $40 billion at legal sportsbooks in the first quarter of 2026. It's a huge number... So you may be surprised to learn that prediction markets’ volume on sports-related contracts roughly matched that figure.
As far as legislation is concerned, though, there is one core difference between the two, as things stand: a sportsbook in West Virginia is subject to the state Lottery Commission’s authority, but a prediction market falls under the jurisdiction of the Commodity Futures Trading Commission (CFTC), which oversees event contracts.
Two Rulebooks for the Same Game
Sportsbooks operate under a set of regulations that states have spent years building. In West Virginia, you’ll find a minimum age requirement of 21 and a 10% tax on sports betting revenue. Tax revenue like that matters to the state, as overall collections are currently running ahead of estimates.
Prediction exchanges, on the other hand, operate under a completely different regime. Here are the main contrasts:
- Regulator: the state Lottery Commission for sportsbooks, versus the CFTC for exchanges
- Minimum age: 21 for sportsbooks, while many exchanges accept users from 18
- Pricing: an implied margin at sportsbooks, versus market odds plus a fee on exchanges
- Taxes: a state-specific rate for sportsbooks (10% here), but no state gaming tax for exchanges
In its comments to federal regulators this April, the National Conference of State Legislatures pointed to state gaming laws as a boon to the economy. It noted that 39 states have legalized sports betting, with regulated gaming supporting 1.8 million jobs and $53 billion in tax revenue.
What an Exchange’s Terms and Conditions Say About It
The differences are reflected in the fine print. For a useful example, Sportsbook Review has a detailed breakdown of one exchange’s welcome bonus. If you’re a new user, you can enter the promo code SBR and deposit $10 to get a $25 trading bonus (reduced from $50 on October 1). The bonus can only be used for trades, but any profits from it can be withdrawn.
Withdrawals are only possible in cryptocurrency; you’ll also have to complete identity (KYC) verification. More importantly, the review makes it clear that traders buy and sell from each other. As a result, you pay a fee on each trade, which peaks on contracts priced around 50 cents.
The review also explains that you can offset a position by selling it to another trader before the event settles (if there’s demand for it), whereas cash-out options at sportsbooks are at the discretion of the operator. The review counts more than 150 NFL markets on the platform.
Its responsible gaming features, including deposit limits and self-exclusion, will look familiar to sportsbook users. The page also has a legal section covering the platform’s ongoing litigation with New York.
This is the page’s value – it lets you explore the product while seeing the regulatory questions hanging over it.
Split Courts Could Send This to the Supreme Court
On state versus federal jurisdiction, the courts have been unable to reach a consensus. In April, the Third Circuit ruled in favor of the exchange in its dispute with New Jersey, which put it at odds with later rulings from the Ninth Circuit (Nevada) and the Sixth Circuit (Ohio and Tennessee).
New Jersey has since petitioned the U.S. Supreme Court to take up the case. Attorneys general from 39 states and the District of Columbia have filed a brief backing it. The NFL has weighed in separately, arguing that contracts tied to injuries or officiating should be restricted.
In the meantime, states have kept up the pressure. Ohio recently issued 10 cease-and-desist letters, with a deadline of October 16 to stop offering sports contracts. Gaming attorney Daniel Wallach has tracked 38 state wins in 43 rulings on preliminary relief.
Congress has also taken note. A bipartisan Senate bill, introduced in March, is designed to bar federally registered exchanges from listing contracts that resemble sports bets. That would cover Super Bowl contracts, which topped $1 billion in trading this year, according to the bill’s sponsors.
What It Means for You in West Virginia
As it stands, the contracts are available to trade here, so you can see the key differences for yourself.
For a fair comparison, weigh each trade’s fee against the markup built into sportsbook odds. Take into account the age and location requirements as you register. At all times, use deposit limits as tools for responsible play. Access could also change quickly, especially if the Supreme Court takes the case.
Whether you’re gauging WVU’s bowl chances following a 3-2 start, or exploring the weekend’s NFL slate, remember that whichever platform you choose has its own terms – which may still change if the higher courts revisit the current rulings.