Why are forecasting platforms sitting?

The nation’s largest horse race, the Kentucky Derby, takes place Saturday in Louisville. If you’re looking to bet on Kalshi, Polymarket, or any other prediction platform about the event — you’re out of luck.

There are no Kentucky Derby event contracts offered on the major forecasting platforms, which host contracts on everything from sporting scores to geopolitical events to reality TV moments, but not horse racing..

Bill Carstanjen, CEO churchill downs, The company that owns the Kentucky Derby and its racetrack told CNBC that the horse race is unlikely to appear in prediction markets at all because the racetrack owners don’t want it.

“You have to go to us, the ones who own the racetracks, to make a deal,” Carstanjen said in an interview this week. “And from our perspective, that’s not something we’re interested in doing.”

Horse racing has always been its own little fiefdom. Race betting, the original form of sports betting in America dating back to colonial times, enjoyed a special status even before the Supreme Court in 2018 struck down a law barring states other than Nevada from offering sports betting.

By law, under the Interstate Horse Racing Act of 1978, the offering of bets on horses requires the express permission of the host racetrack, the jockeys’ group of owners and trainers and the racing commission of the state where the race is being held.

This left the thriving prediction markets industry offshore.

“Prediction markets are not something that would be beneficial to horse racing, or the economic model under which our industry operates, which involves portfolio financing of horse racing winners,” Carstanjen said.

Kalshi declined to comment on the absence of horse racing on his platform. Polymarket did not respond to a request for comment. Representatives of the Commodity Futures Trading Commission, which regulates event contracts, did not respond to a request for comment.

The tension raises an interesting question about when—and in what context—permission is necessary for prediction market platforms to offer contracts on a given event.

US states have argued that companies like Kalshi and Polymarket need their permission (through a licence) to offer betting on sports. Prediction platforms emphasized that they do not need licenses because their platforms offer investment and trading activities, not gambling, and because they are regulated by the Commodity Futures Trading Commission (CFTC).

The CFTC has filed multiple lawsuits against states seeking to prevent it from taking action against forecasting platforms.

Kentucky, for its part, has taken a hard line on projections. State lawmakers have proposed legislation that would prohibit any gambling licensees from making predictions. It is also proposed to impose a 17.5% tax on prediction market fees.

Meanwhile, there is still good old-fashioned gambling at Derby on Saturday. Churchill Downs said it sees an increase in betting during the Derby week leading up to the big race.

caesar, He also said the amount of money being wagered on the Kentucky Derby exceeds expectations.

— CNBC’s Jessica Golden contributed to this report.

Disclosure: Kalshi and CNBC have a business relationship that includes a minority investment.