Novig announced Thursday that it is the first prediction market operator to codify a full responsible-trading framework directly into its Commodity Futures Trading Commission-regulated exchange rulebook.
One of those rules is a 21+ requirement to trade on the platform. The news comes a day after automated investment company Betterment published a study that shows more Gen Z individuals (ages 14 through 27) are using investment funds at sportsbooks.
While prediction markets view themselves as financial contracts, platforms act – and, until recently, were allowed to look – similar to regulated sportsbooks.
Novig is the first to adopt responsible trading rules comparable to the legal betting industry, but it isn’t the first predictions operator to address problem gambling. Kalshi joined the National Council on Problem Gambling in May, which has led to other members leaving.
New Novig rulebook, in detail
The responsible trading framework has been incorporated into Chapter 14 of the Ludlow Exchange rulebook. Novig is the first to implement a 21-year-old age requirement. Other prediction markets allow users 18 and up to trade.
In addition, Novig is including comprehensive user controls, allowing participants to establish limits for deposits, losses, and exposure, receive elapsed-time reminders, take cooling-off periods and choose multiple self-exclusion timelines, including indefinitely.
Novig is also applying responsible marketing standards, which bans marketing to individuals under 21 and ends the use “risk-free” claims. Sportsbooks stopped using similar language in early 2023 when Ohio banned sportsbooks from saying a bonus is free if someone must deposit their own cash to receive it. There would also be preventative programs tied to loss-chasing, escalating deposits, or maintaining losing positions.
Novig co-founder and CEO Jacob Fortinsky puts the onus on his exchange when it comes to financial trading.
“Responsible trading shouldn’t rest solely with the customer—it should always begin with the exchange itself,” Fortinsky said in the release. “By codifying responsible trading standards directly into our rulebook, we’re holding ourselves to the same high standard we expect of our participants and establishing a new benchmark for how federally regulated prediction markets should operate.”
More safeguards built into the exchange
In addition to the above responsible trading tools, there are several more tools Novig implemented:
- Responsible platform design requirements that require clear disclosure of amounts at risk, maximum potential losses, and settlement terms while evaluating platform features that could obscure risk or encourage impulsive trading.
- Responsible contract review, requiring participant-protection considerations before new contracts are listed and allowing for enhanced disclosures, tighter limits, or other safeguards where appropriate.
- Risk-based monitoring that identifies observable patterns such as rapid increases in deposits or trading activity, repeated deposits following losses, attempts to raise limits or remove a member established exclusion, or apparent loss-chasing, with responses ranging from educational prompts to temporary or permanent restrictions.
- Ongoing accountability and oversight, including metrics, recordkeeping, periodic review of the framework’s effectiveness, and information available to the CFTC upon request.
Gen Z gambling on retirement?
According to the Betterment study, 26% of Gen Z investors use sports betting as a financial investment. That number drops as age increases: 14% of millennials, 6% of Gen X and 1% of baby boomers do the same.
More than half of Gen Z investors, 52%, said they had redirected money originally earmarked for investing into sports betting over the past year. Another 14% do so multiple times a month.
The sports betting industry yielded $166.94 billion in handle and nearly $17 billion in revenue last year. Kalshi has reported more than $154 billion in trading volume so far in 2026 with around 85% traded on sports, according to Ticker-Tracker.
That scale hasn’t gone unnoticed by the wealth-management industry.
“When a prediction market or sportsbook starts to feel like a retirement strategy, we have a problem,” Betterment CEO Sarah Levy said. “These products are designed to keep people seeking the next quick score, not to help them build toward the next decade. Younger investors deserve access to the tools and information that meet them where they are, but the industry also has a responsibility to be clear about the difference between participating in a trend and building lasting wealth.”
Novig’s litigation trail
While Novig has launched a prediction market across the U.S., the operator is involved in a number of lawsuits.
A day after its nationwide launch, Novig sued New York, seeking to block the state from enforcing its NY sports betting laws against the platform.
The operator filed similar lawsuits in Massachusetts, New Mexico and Washington.
