CFTC Sends Two Prediction Market Rules to White House as…
By Abdelaziz Fathi
AI summary of the source article
The Commodity Futures Trading Commission submitted two prediction-market rulemakings to the White House's Office of Information and Regulatory Affairs on September 28. One proposed rule aims to define swaps to include event contracts, while an interim final rule excludes casino-style gambling products from swap definitions. The submissions represent the agency's effort to assert federal jurisdiction over prediction markets as states seek to regulate sports-related contracts under local gambling laws. The timing coincides with conflicting appellate decisions: the Sixth Circuit recently ruled against Kalshi regarding its sports contracts, while a conflicting Third Circuit decision is currently facing a Supreme Court petition.
Why it matters
How the CFTC distinguishes event contracts from casino-style gambling could determine whether sports prediction markets stay nationally available through federal exchanges or become subject to state-level gambling restrictions.
Key facts
- The CFTC submitted an interim final rule excluding casino gambling and a proposed rule including event contracts as swaps to OIRA on Sept. 28.
- The Sixth Circuit ruled Kalshi failed to show its sports contracts qualify as swaps, conflicting with a Third Circuit decision now subject to a Supreme Court petition.
- The CFTC has sued several states, including New York and Illinois, asserting exclusive federal authority over prediction markets against state gambling enforcement.