Novig said the CFTC granted it designated contract market status on 16 June, authorising it to operate a regulated sports prediction exchange nationwide. The company said the designation enables operation under one federal framework; rival ProphetX said it received its own federal approval on 11 June.
The designation gives Novig a federal route to operate its sports prediction exchange across the USA.
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It was reported that Novig submitted plans to CFTC for a broad range of sports event contracts. Regulatory documents on Ludlow Exchange’s website showed 68 filings in total.
It was reported that US financial analysts criticised plans by Tidal Investments and Subversive Capital to launch prediction market and sports contract-themed exchange-traded funds, comparing the approach with stock picking. Earlier in July, the two firms asked the SEC to approve two sports-event contract ETFs tied to event outcomes.
Kalshi chief executive Tarek Mansour said he remained confident in the company’s legal position as conflicting federal appeals rulings and New Jersey’s Supreme Court petition raise the prospect of review in the USA. He said sports contracts, which made up roughly 95% of Kalshi’s revenue nine months earlier, now account for about 65%.
Kalshi chief executive Tarek Mansour said he remains confident in the company's legal position as conflicting federal appeals rulings and New Jersey's Supreme Court petition raise the prospect of review in the USA. Speaking on a Reuters podcast, Mansour said the process would play out as it would.
North American Derivatives Exchange, which operates Crypto.com's OG prediction market, and Ludlow Exchange, Novig's operator, filed separate lawsuits on 16 October challenging Missouri's 21-year age minimum and 10% tax on sports event contracts. Both argue that federal commodities law gives the CFTC authority over their contracts, pre-empting state gambling rules, after a 30-day compliance period following cease-and-desist notices expired. Missouri Attorney General Catherine Hanaway's office maintains that labelling a sports bet an event contract does not remove it from state law.
North American Derivatives Exchange, which operates Crypto.com's OG prediction-market platform, and Ludlow Exchange, the operator behind Novig, filed separate lawsuits on 16 October challenging Missouri's sports event contract rules. The filings followed the expiry of a 30-day compliance period set out in cease-and-desist notices. Both companies argue that federal commodities law gives the Commodity Futures Trading Commission authority over their contracts, putting them outside Missouri's gambling requirements.
Kalshi asked the full Sixth Circuit to reconsider its 25 September ruling allowing Ohio and Tennessee to pursue enforcement under state gambling laws. The company argues that federal commodities law gives the CFTC authority over contracts traded on designated exchanges; the court has not accepted that argument.