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CFTC moves to redefine swaps for prediction markets
The CFTC submitted two federal rule proposals to the White House office for pre-public review, aiming to bring event contracts under its swaps authority.
The Commodity Futures Trading Commission has sent the White House two proposed rules intended to clarify how federal law defines a swap when the underlying product is an event contract, such as the yes-or-no wagers traded on platforms like Kalshi and Polymarket, according to Decrypt.
The first proposal would further define the term "swap" to explicitly include event contracts and is set to go to public comment, while the second would carve out "casino-style gambling products" from the swap definition and could take effect after approval as an interim final rule.
The rules were submitted to the Office of Information and Regulatory Affairs on Sept. 28, and the CFTC classified both proposals as not economically significant, Decrypt reported, adding that their full text is not yet public.
The CFTC action is tied to a jurisdictional dispute over whether prediction markets fall under federal oversight, with Decrypt noting that multiple states have sued operators over gambling claims.