CFTC Chair Michael Selig said the commission is filing a friend-of-the-court brief in the Ninth US Circuit Court of Appeals in support of Crypto.com. He said nearly 50 active cases challenge federal oversight of event contracts, with many arguing they amount to gambling under state laws.
The dispute could determine whether states or the CFTC oversee event-contract markets.
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CFTC chair Michael Selig said prediction markets could help people with medical conditions manage financial risks associated with future treatment costs. He cited trading on the likelihood of a drug passing a trial as an example. The CFTC has opened a public comment period on proposed prediction-market rules, and Selig said the agency would assert its jurisdiction over the markets.
CFTC Chairman Michael Selig said the commission would support lawful prediction markets and sports event contracts at a joint event in Washington, DC. He is withdrawing a 2024 proposed prohibition on political and sports contracts and an internal advisory, and plans to develop rules for event contracts.
SEC Chair Paul Atkins told lawmakers that prediction markets may fall under both the SEC and CFTC, according to the report. He said some contracts could resemble securities and that the agencies should coordinate; the report cited an industry value of $63.5bn, attributed to Certik.
SEC Chair Paul Atkins said at a Senate Banking Committee hearing that prediction markets may involve overlapping SEC and CFTC jurisdiction. He said sports event contracts were unlikely to fall under SEC oversight, while products linked to company events and securities could involve the agency.
A US Court of Appeals issued a ruling supporting Kalshi's efforts to offer sports-related prediction markets in New Jersey, according to the report. The available article text provides no further details about the ruling.