Willing to risk 46 cents on Chris Shula?
Less than a week into the Pittsburgh Steelers’ search, online prediction markets have taken in more than $340,000 from those speculating about who will or won’t be the next coach.
The innovative websites operate more like stock markets than the sportsbooks of traditional gambling outlets. They also face different government regulations, which has drawn the NFL’s ire. But that concern hasn’t stifled their popularity with risk-taking football fans, who can predict the outcome of events, like who’ll be hired where.
Shula, the Los Angeles Rams defensive coordinator, was the early favorite after interviewing Friday with the Steelers, according to Kalshi.com. The market volume for predicting the Steelers’ coach had surpassed more than $346,000 by 6 p.m. Saturday, according to Kalshi’s website.
Minnesota Vikings defensive coordinator Brian Flores has the second-highest chance to become coach, according to users, followed by Rams pass game coordinator Nate Scheelhaase.
None of the 29 candidates listed by Kalshi were above 50% on Saturday. Shula stood at 46%, Flores 31% and Scheelhaase 14%, but those numbers sometimes change by the minute.
According to Kalshi, its market operates by selling contracts to users based on “yes or no” questions. Those contracts cost between one dollar and one cent, a price determined by the perceived strength of the prediction.
With Shula, for example, a “yes” prediction could be purchased Saturday for 46 cents. If he were hired by the Steelers, each contract pays out $1.
Conversely, those believing Shula won’t be the Steelers’ chose could buy a “no” prediction for 61 cents. If not hired, those are worth $1.
Losing predictions are ultimately worthless, but contract holders can sell for “market value” until a coach is hired. The NFL came to terms with sports betting in recent years but now sees prediction markets as potentially troublesome.
Responding to a request for comment, an NFL spokesperson Saturday referred to written testimony NFL executive vice president Jeff Miller submitted to congress in December.
“The amounts potentially wagered through unregulated gaming contracts markets could significantly exceed those in regulated sports betting markets, creating substantially greater risks to contest integrity,” Miller wrote to the House Agriculture Committee.
He noted the NFL had no plans to participate in prediction markets because of “several outstanding legal, regulatory and commercial concerns” that risked the integrity of sporting events.
“We are particularly troubled that several sports-related futures contracts have been launched nationwide, including in jurisdictions where sports betting has not been legalized,” Miller said. “These contracts fall outside the purview of state regulatory authorities and the safeguards they impose upon the industry, including information-sharing requirements, integrity monitoring, prohibitions on easily manipulated markets, official league data requirements, know-your-customer protocols and problem gambling resources.”
Prediction markets are overseen federally by the Commodity Futures Trading Commission. Meanwhile, in Pennsylvania, sports gambling is regulated by the state’s gaming control board.
In an October letter to Pennsylvania’s two U.S. Senators, board executive director Kevin O’Toole was critical of a dual-track system of regulation.
“Sports prediction markets operate under the assertion that they are financial derivatives, or swaps, and therefore claim to not be gambling under state law,” O’Toole said. “These markets effectively create a backdoor to legalized sports betting, operating parallel to, but outside of, the state-regulated system, and without strict oversight.”
Kalshi, founded in 2018 by two former MIT students, is one of several popular prediction markets available online. The websites offer prediction options beyond sports, including elections, award shows, weather and more.
Polymarket, another top prediction market, also offers a market for NFL coaching hires. Neither Kalshi nor Polymarket immediately returned a request for comment Saturday.
Contracts on all nine NFL job openings were available for purchase on Kalshi, with the first one resolved Saturday when the New York Giants hired John Harbaugh. That market saw a volume of $2.32 million, according to the website.
The other eight NFL jobs that remain open have combined for $4.22 million in volume through 6 p.m. Saturday. Most active was the Miami Dolphins job with $902,796 in trading volume.
Green Bay Packers defensive coordinator Jeff Halfley was favored at 80% to become Miami’s coach. The only other heavy favorite for a job was Kevin Stefanski (86%) in Atlanta.
Prediction markets would seem susceptible to manipulation by those with inside information. Rules vary by company, but Kalshi bans any such advantage.
“Like any other financial market, we strictly prohibit anyone trading with insider knowledge,” Kalshi said on its website. “These rules are clearly stated in our exchange Rulebook, and violations of them can result in suspension or permanent exclusion from the exchange, and referrals of flagged transactions to federal law enforcement.”
Market movers
Online prediction market Kelshi ranked Chris Shula as the top candidate to become the Pittsburgh Steelers coach. Here’s a look at the favorites for the eight open jobs and the total trading volume for each as of 6 p.m. Saturday.
Team, Favorite, Volume
ARI, Vance Joseph (31%), $92,919
ATL, Kevin Stefanski (86%), $556,698
BAL, Jesse Minter (40%), $715,071
CLE, Jim Schwartz (49%), $507,717
MIA, Jeff Hafley (80%), $902,796
PIT, Chris Shula (46%), $347,599
TEN, Matt Nagy (57%), $697,509
LV, Brian Flores (16%), $405,852