The CFTC is reportedly reviewing whether Kalshi gave it proper notice of proposed event contracts. Kalshi said the inquiry covers a small group of submissions, many tied to contracts that never went live, and that it is addressing the matter; weather-related contracts were reportedly among them.
The review puts Kalshi's process for submitting proposed US event contracts under regulatory scrutiny.
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Panelists at the Next Predict Summit in New York argued that states should not apply gaming laws to sports event contracts traded on federally regulated exchanges. Courts have split on whether the contracts are swaps under the Commodity Exchange Act, and the Supreme Court case involving New Jersey is pending.
Panelists at the Next Predict Summit in New York said states should not apply their gaming laws to sports event contracts traded on federally regulated designated contract markets. The panel discussion, titled "The Jurisdiction Gap: One ruling, Two Very Different Markets," took place on Friday. The industry position is that the contracts are federally regulated derivatives, and that the Commodity Exchange Act gives the Commodity Futures Trading Commission explicit jurisdiction over the transactions.
The CFTC proposed rule changes on 9 October to classify sports, political, cultural and weather event contracts as swaps under US federal law. The proposal would explicitly include these contracts in the agency’s rules.
The Commodity Futures Trading Commission (CFTC) has proposed amending its rules so that event contracts based on sports, politics, culture and weather are explicitly included in the definition of a swap under federal law. The proposal was announced on 9 October, according to the regulator, and a public consultation has been opened before the agency decides whether to adopt the change.
The US Supreme Court has yet to decide whether to review prediction market litigation involving Kalshi. Legal observers warned that declining review could leave conflicting appeals court decisions unresolved and operators facing separate state disputes over the regulatory status of sports event contracts.
A report dated 12 October 2026 notes that the justices have so far given no indication of whether they will take up the Kalshi prediction market disputes. In the view of legal observers quoted in that report, refusing the petitions would probably push operators into a state-by-state contest over sports event contracts that varies from jurisdiction to jurisdiction.
The CFTC issued two proposals concerning federal oversight of event contracts. The proposals would classify event contracts as swaps while prohibiting traditional gambling, with the expanded definition covering contracts linked to culture, weather, politics and sport.
The CFTC has sent two proposed rules to the White House Office of Management and Budget for review, reportedly earlier this week. One would exclude casino-style gambling from the definition of a swap; the other would classify event contracts as swaps and follow the standard public-comment process.