The US Commodity Futures Trading Commission has launched a rulemaking process on prediction markets, asking the public to comment on how federal derivatives law should apply to event-based contracts.
CFTC Chair Michael Selig issued a staff advisory classifying event contracts on platforms such as Kalshi and Polymarket as a financial asset class under the Commodity Exchange Act.
“Prediction markets are one of the most exciting innovations in financial markets,”
Said CFTC Chair, Michael Selig.
The regulator also released an Advanced Notice of Proposed Rulemaking seeking input on whether new or amended regulations are needed for event contracts traded on prediction market platforms.
Selig has repeatedly argued that the CFTC holds exclusive jurisdiction over prediction markets, pushing back against state authorities that have pursued legal action against companies offering sports-related event contracts.
The proposal arrives as courts deliver mixed rulings on whether prediction market contracts fall under federal derivatives law or state gambling regulations.
The public will have 45 days to submit comments once the proposal is published in the Federal Register, after which the CFTC may move toward formal rulemaking.