At the Saratoga Racing and Gaming Conference, Tres York, the vice president of government affairs at the American Gaming Association, addressed an unusual and contentious topic: contracts related to tossing adult toys onto WNBA courts. He spoke on a prediction markets panel on August 11, immediately apologizing to the audience for the subject matter before diving into the discussion. This follows a concerning trend, particularly after a second arrest involving someone throwing an adult toy onto or toward a WNBA court. York criticized an offshore prediction market for facilitating event contracts about this bizarre behavior. He pointed to Polymarket, which allowed individuals to bet on whether an adult toy would make it onto the court during a live game. During the conference, Polymarket reported over $70,100 in trading on a binary contract related to whether a fan would successfully hurl a toy onto the court during the evening's game between the Connecticut Sun and the Golden State Valkyries.
Amid heightened integrity concerns regarding live betting markets, York expressed skepticism about the 'economic utility' of these contracts, stating, “I’d be real curious to hear what the economic utility is for that type of behaviour, because it’s pretty pathetic to me.” David Aron, a special counsel at Lowenstein Sandler and a former employee of the US Commodity Futures Trading Commission, echoed York’s sentiment, claiming that there is no real economic value in these 'wacky contracts.'
On August 6, Phoenix police arrested Kaden Lopez, an 18-year-old, after he attempted to throw an adult toy during a game between the Phoenix Mercury and the Sun. His throw missed the court, instead hitting a spectator attending the game with his nine-year-old niece. That same night, a bright green toy struck Indiana Fever guard Sophie Cunningham.
York highlighted another Polymarket event contract that permitted users to bet on the color of the next adult toy thrown onto the court, suggesting this could encourage collusion to ensure a green toy is tossed. He raised concerns that, in venues with a no-bag policy, fans might find it difficult to smuggle in a toy, escalating the integrity risks associated with such betting. The liquidity of the markets on Polymarket was significant, with one participant claiming a profit in the four-figure range.
These comments coincided with a revelation from the founder of a crypto meme group who admitted liability for the pranks in a post on X, stating these acts were meant to promote a crypto coin created by their community. Despite this acknowledgment, Polymarket continued to offer betting on these events until August 12. By Thursday, however, no live offerings related to WNBA adult toy contracts remained.
The discussion around adult toy contracts highlights ongoing concerns regarding the regulation of prediction markets, an area of increased scrutiny by the Commodity Futures Trading Commission, especially this year amid high turnover. Leading prediction markets are expected to unveil various event contracts tied to the upcoming football season.
Currently, prediction markets aren’t subjected to the same regulatory and tax limitations as legal sportsbooks, leading some within the gambling industry to argue that they operate on an uneven playing field. Since the repeal of PASPA in 2018, states have been positioned better to oversee sports betting than the federal government.
Last year, the CFTC proposed rulemaking to overhaul its process for regulating event contracts, reinstating an 'economic purpose test' to determine if such contracts are against public interest. On Wednesday, FanDuel announced a partnership with the CME Group to create a new event contracts platform that will comply with CME Group exchange rules, pending CFTC review.
John Berlau, a senior fellow at the Competitive Enterprise Institute and a member of the prediction markets panel, refrained from commenting directly on the adult toy contracts but pointed out the implications of fan behavior, such as catching a foul ball simply to win a bet. He opposed the notion of attributing undesirable actions to prediction markets or sports wagering. "It’s a slippery slope to try to blame this on a prediction market venue or on actual sports wagering," Berlau remarked.
Michelle Cohen, a partner at Ifrah Law and counsel at iDEA Growth who moderated the panel, noted that legal betting markets require approval of state event wagering catalogs, asserting, "It sounds like we need some additional integrity-based tools." Kalshi, a designated contract market, is allowed to self-certify under CFTC regulations and has implemented measures to enhance customer protections. In March, Kalshi partnered with integrity monitor IC360, which CEO Tarek Mansour stated would improve the ability to identify and report bad actors to sports leagues and regulators.
Polymarket is not currently available in the US; however, last month, the Justice Department concluded an investigation of Polymarket without filing charges. Shortly thereafter, Polymarket acquired a CFTC-licensed exchange, a move its CEO Shayne Coplan claimed would enable the platform's re-entry into the US market.
