Operators in Massachusetts are prohibited from providing prediction markets in the state, according to the regulators in the state, according to the regulator.

Operators received a letter from the Massachusetts Gaming Commission (MGC) on Thursday morning cautioning them against providing prediction markets within the state. The MGC did not discuss how it will deal with state-licensed operators that offer or collaborate with prediction markets in other U.S. jurisdictions, in contrast to other authorities.

The letter states, “Please accept this letter as notice that you are prohibited from offering sports-related event contracts in Massachusetts, either directly or through an affiliate, related business entity, or other association, or directing patrons to such event contracts being offered in Massachusetts.”

The letter, which was signed by executive director Dean Serpa, makes it plain that referring “patrons to such event contracts being offered in Massachusetts” or directly selling prediction markets might result in enforcement action up to the “revocation” of a license. Within ten business days, state-licensed operators are required to submit a written response to the MGC “identifying the steps you will take to ensure compliance with this notice.” Similar information has not been demanded from operators by other agencies cautioning them against participating in prediction markets.

One day after the MGC convened in executive session to talk about prediction markets, the letter was distributed. Additionally, the Nevada Gaming Control Board announced that FanDuel is relinquishing its Nevada retail wagering license and DraftKings has withdrawn its licensing applications due to both companies’ plans to offer prediction markets. It was also a day after FanDuel announced that it will start offering prediction markets in partnership with CME starting next month.

Home state-focused regulator

Similar letters have been given to licensed operators by regulators in Arizona, Nevada, and Ohio; however, those three states also stated that they would assess suitability if an operator sells or collaborates with a prediction market in another state. With the exception of writing, “To the extent any other regulator takes action against your license due to your operation in the prediction market space, such action may inform decisions related to your suitability in Massachusetts,” Massachusetts regulators chose to stay within their own boundaries rather than pursue that path.

Both DraftKings and FanDuel have taken steps to begin offering contracts for sporting events. After purchasing the Railbird platform, which is already licensed by the Commodity Futures Trading Commission (CFTC), DraftKings last week declared that it will launch prediction markets, including sports, “in the coming months.” Both businesses have Massachusetts licenses for online gambling, as do BallyBet, BetMGM, Caesars Sportsbook, Fanatics Sportsbook, and Penn Entertainment (formerly ESPN Bet, but moving to theScoreBet on December 1). Wynn Resorts owns Encore Boston Harbour, a sportsbook with a physical location but no online presence in Massachusetts.

The MGC letter does not take into account involvement in prediction markets in other states, but it does leave open the possibility that it may reexamine that matter or any other prediction market-related issues.

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