Hong Kong Abandons Basketball Betting Due to Prediction Markets Proliferation

Hong Kong has officially abandoned its plans to legalize basketball betting, citing concerns related to the emerging prediction markets sector as the reason. While the possibility of introducing basketball betting at a later date could still be there, officials said that they wish to see how prediction markets affect the region.

Hong Kong Gives Up on Basketball Betting for Now

Although Hong Kong prohibits private companies from offering wagering on sports, the region has been gradually allowing the Hong Kong Jockey Club to accept wagers on certain disciplines. So far, the state monopoly has been allowed to offer bets on horse races and soccer. In addition to that, the Jockey Club also operates the local lottery.

The growing popularity of basketball caused Hong Kong to consider regulating basketball bets, adding the discipline under the purview of the Jockey Club. Proponents argued that the move did not seek to encourage more gambling, but rather to redirect existing activity from the black market.

While the planned legalization included a 50% tax, officials rejected financial gain as the reason for the move.

While the historic addition of basketball betting has been talked about for months, with lawmakers making significant strides toward the launch of basketball betting, officials confirmed that they have abandoned these plans, at least for now.

According to the Home and Youth Affairs Bureau, the government’s decision to halt the introduction of basketball betting was due to the rapidly growing prediction markets space.

Event Contracts Are Big in China

Prediction markets are a form of trading where participants can buy and sell yes-no shares in the outcomes of events ranging from sports to politics. The steady growth of such products has been marred by controversy due to their similarity to sports betting and alleged predisposition to insider trading.

Hong Kong has not been unaffected by the expanding popularity of prediction markets either, as the Home and Youth Affairs Bureau cited them as the chief reason for abandoning its plans to launch basketball betting.

The bureau said that prediction markets participation is spiraling out of control in China, forcing it to rethink its approach to betting and conduct an in-depth study into the event contracts space.