CFTC to write new rules for prediction markets, chairman Michael Selig says | Yogonet International
Summary
The Commodity Futures Trading Commission (CFTC) will draft new, clearer rules for prediction markets, CFTC Chairman Michael Selig announced, after withdrawing earlier staff guidance that would have limited contracts tied to sports and political events. Selig said regulatory uncertainty has hindered market development and that the Commission intends to support lawful innovation while prioritising investor protection, anti-fraud enforcement and market integrity.
Selig ordered staff to withdraw a 2024 proposed rule that would have banned sports- and politics-linked contracts and rescinded a 2025 staff advisory on sports-related event contracts. He signalled the CFTC may take a more active role in federal court cases that test jurisdiction over event contracts and pledged closer coordination with the SEC on oversight of crypto assets, credit swaps and other emerging instruments. The Coalition for Prediction Markets welcomed the move.
Key Points
- Chairman Michael Selig announced the CFTC will write comprehensive rules for event-based prediction contracts to remove regulatory uncertainty.
- The CFTC has withdrawn a 2024 staff proposal that would have banned sports and political contracts and rescinded a 2025 advisory on sports-related contracts.
- Prediction platforms such as Kalshi and Polymarket have grown rapidly, prompting scrutiny from state regulators and tribal governments over jurisdiction and gambling authority.
- Selig said the Commission may intervene more actively in federal litigation to defend CFTC jurisdiction over commodity derivatives linked to events.
- The CFTC will coordinate more closely with the SEC on crypto assets, credit swaps and other novel financial products as part of a modernised regulatory approach.
- Investor protection, anti-fraud enforcement and market integrity remain core priorities as the agency develops new rules.
- The Coalition for Prediction Markets praised the decision, saying clearer federal rules will foster responsible innovation and market clarity.
Why should I read this?
Short version: if you run, use or regulate prediction markets (or work in sports betting, crypto or derivatives), this is a big deal. The CFTC is moving from fuzzy staff guidance to formal rules — that changes legal risk, business models and who gets to regulate what. Read it to know whether your product needs a legal rethink or if a courtroom fight over jurisdiction could land on your doorstep.
Author style
Punchy: this is a notable regulatory pivot — the CFTC is signalling it will actively define its turf rather than leave markets guessing. If you care about compliance, market access or litigation risk, the details matter.