CFTC moves to define event contracts as swaps

• The CFTC has submitted two prediction-market rules for federal review.
• One proposal would classify certain event contracts as swaps under derivatives law.
• The proposals could reshape the regulatory dispute over prediction markets.

The U.S. Commodity Futures Trading Commission has submitted two prediction-market rules for federal review.

One proposal would classify certain event contracts as swaps, while another would exclude casino-style gambling products.

The CFTC proposal would establish when event contracts fall within federal derivatives rules.

The move comes as states challenge federal oversight of sports-related prediction contracts.

Federal appeals courts have issued conflicting rulings over whether Kalshi’s sports contracts qualify as swaps.

The proposals cover event contracts offered through platforms including Kalshi, Polymarket, Crypto.com and Robinhood.

The CFTC submissions have reached the Office of Management and Budget for review.

The proposals could clarify how federal regulators classify prediction-market contracts under U.S. derivatives law.