Former New Jersey Governor Chris Christie has a message about sports prediction markets, and it's not subtle: they're illegal, they're dangerous, and they need to shut down. Speaking with CNBC's Contessa Brewer on Thursday, Christie laid out why he thinks the rapid expansion of these platforms poses serious legal, economic, and ethical problems for both consumers and the sports world.

The Case Against Prediction Markets

Christie, who ran for president in 2016 and 2024 and now works as a strategic advisor to the American Gaming Association, says these unregulated prediction markets are operating illegally across the country. They're skirting state laws, undermining consumer protections, and cutting into state tax revenues that properly regulated sportsbooks would generate.

His argument is straightforward: these platforms threaten "the integrity of the sport," weaken "consumer protection," and "hurt tax revenue in those states." The "bottom line," he said, is that "it's against the law, and they need to be stopped."

What really seems to bother Christie is the regulatory arbitrage these companies are attempting. Platforms like Kalshi claim they're regulated by the Commodity Futures Trading Commission, which would theoretically shield them from state gambling laws through federal oversight. Christie calls this defense misleading at best.

"The idea that CFTC is regulating sports is untrue, and Kalshi knows it," he said.

The College Sports Corruption Problem

Beyond the jurisdictional debate, Christie raised concerns about some genuinely weird betting products entering the market. One particularly troubling example: wagers on whether college athletes will enter the NCAA transfer portal.

"Imagine how much that could be manipulated," he said, sketching out a scenario where "a gambler comes and offers a huge amount of money for a young man or woman to not go into the transfer portal." This wouldn't just distort competition, Christie argued. It would "change the nature of the sport" and "corrupt these athletes."

It's not hard to see his point. If you can bet serious money on whether a college basketball player stays at their school or transfers, suddenly there's a financial incentive for bad actors to influence that decision. College athletes, many of whom don't come from wealth, could face pressure from people with substantial financial stakes in their personal choices.

Christie contrasted this unregulated landscape with existing state-regulated sportsbooks, which he says provide crucial oversight mechanisms that prediction markets simply don't have. And he doesn't think this debate is going away quietly. The legal battle, he predicted, "will make it to the Supreme Court."

The Legal Battles Are Already Heating Up

Christie isn't alone in his concerns. Last month, investor Ross Gerber called sports prediction markets "just illegal sports betting operations that somehow has been allowed to exist," adding that it was "crazy this hasn't been stopped."

According to Gerber, platforms like Kalshi and Polymarket are essentially rebranding sports bets as futures contracts to circumvent state laws. The strategy has had mixed results in court.

Recently, a Nevada judge reversed a crucial order for Kalshi, ruling that contracts based on sporting event outcomes aren't actually subject to CFTC regulation. That's a significant blow to the "we're federally regulated" defense these platforms have been using.

Meanwhile, Coinbase Global Inc. (COIN) has taken the offensive, filing lawsuits against Michigan, Illinois, and Connecticut to challenge state regulatory authority over prediction markets. The crypto exchange argues that state regulations would cause "immediate and irreparable" harm to its operations.

Shares of Coinbase were down 2.36% on Wednesday, closing at $226.14, and were up 1.38% overnight. The stock has been struggling on multiple fronts, with unfavorable price trends across short, medium, and long-term timeframes.

The fundamental question here is whether these platforms are running legitimate prediction markets or just sports betting with extra steps. State regulators clearly think it's the latter. The companies insist they're something different, governed by federal commodities law rather than state gambling regulations. Christie's prediction of a Supreme Court showdown suggests nobody expects this to get resolved quietly at the state level.