Council Speaker Julie Menin sent letters to Kalshi, Polymarket, Coinbase, and Gemini Titan over allegations of deceptive marketing that pushes consumers toward bets on sports and politics.
Alpha Score of 38 reflects weak overall profile with weak momentum, weak value, poor quality, strong sentiment.
The New York City Council launched an investigation Wednesday into the advertising practices of four prediction market platforms, focusing on what it called deceptive marketing that pushes consumers toward bets on sports, politics, and other events.
Council Speaker Julie Menin sent letters to Kalshi, Polymarket, Coinbase, and Gemini Titan. The council will look into allegations of "false, deceptive, unconscionable and objectionable marketing practices," Menin said in a statement.
"Prediction markets aggressively entice consumers to bet and wager on sports, politics, culture, weather and pretty much anything," Menin said. "I intend to harness the full power of the Council to protect New Yorkers from deceptive and predatory marketing practices by prediction market platforms."
The Wall Street Journal reported in June that Polymarket paid social media influencers to make it look like they were earning large sums betting on the platform, when the influencers were not using their own money. The council said it is investigating undisclosed influencer marketing, videos showing fake trades on sites designed to mimic Polymarket, made-up depictions of winning bets that would have lost money, and promotion of insider trading.
On Tuesday, CNBC reported that Polymarket is changing its marketing strategy after the Commodity Futures Trading Commission opened its own probe.
Council Member Harvey Epstein, chair of the Committee on Consumer and Worker Protection, said the investigation will determine what new rules are needed. "With the industry aggressively marketing to New Yorkers, we have a responsibility to investigate their claims and the advertising tactics these companies are using to ensure they are following the law," he said in a statement. Epstein cited the "potentially addictive nature of prediction markets."
The state of New York has already sued Kalshi, Coinbase, and Gemini, arguing they run illegal gambling operations. The platforms say they are federally regulated financial exchanges and not subject to state betting laws. Kalshi, Polymarket, and Gemini are all based in New York City. Coinbase, headquartered in Texas, has said it plans to hire more than 1,000 people in the state.
The council's investigation is critical to determining what legislation, regulations, and programs are needed, Menin said.
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