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CFTC and states remain at odds over prediction-market oversight

Regulation

The CFTC and state authorities remain divided over who can regulate prediction-market platforms in the United States, with the commission having sued nine states, the report said. Experts quoted in the report said a near-term compromise was unlikely; states argue event contracts fall under gambling laws, while the CFTC regards them as financial instruments.

The unresolved jurisdictional dispute affects prediction-market platforms’ ability to offer contracts across state lines.

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Regulation

CFTC and states dispute authority over prediction markets

The CFTC and state gaming regulators dispute who should oversee prediction markets. The report highlighted expanding sports event contracts and quoted Rob Schwartz describing the jurisdictional litigation.

The Commodity Futures Trading Commission (CFTC) and state gaming regulators are in dispute over which body should oversee prediction markets, according to remarks made at a panel discussion on prediction market regulation at Predict 2026 in New York. Rob Schwartz, a partner in the futures and derivatives practice at Morgan, Lewis & Bockius, described the situation as contested litigation over whether such products are state-regulated gambling or federally regulated derivatives trading.

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