CFTC sends two prediction market rules to White House for review
In brief
- CFTC sent two event contract rules to the White House OMB on September 30, per Crypto Briefing.
- Proposed rule would amend the swap definition to explicitly cover event contracts.
- Interim final rule would exclude casino-style gambling products from swap classification.
- Ohio and Tennessee are litigating with the CFTC; New Jersey sought Supreme Court review.
- Neither rule is final; both still need to clear White House review.
What the two rules do
The first measure is a proposed rule that would amend the regulatory definition of a "swap" so it explicitly covers event contracts. That's the key move. Swaps fall under the Commodity Exchange Act, and the CFTC maintains it holds exclusive jurisdiction over event contracts under that same law, Crypto Briefing reported.
The second measure is an interim final rule, and it cuts the other way. It'd exclude casino-style gambling products from being classified as swaps. Agencies typically use interim final rules when they want a rule to take effect while public comments are still being gathered (rather than waiting for the full process to finish), according to the outlet.
Neither rule has been adopted.
Both still need to pass White House review, and the proposed rule would go through its own process, including public comment, before it becomes final.
States are pushing back
Ohio and Tennessee have argued that sports event contracts violate their state gambling laws, and they're in litigation with the CFTC, per Crypto Briefing's report. New Jersey has taken it further. The state's attorney general has asked the Supreme Court to review the jurisdictional question.
The submission follows other recent moves at the agency. In June, the CFTC issued a notice of proposed rulemaking that sought public comment on how to assess event contracts tied to specified activities (gaming included). Then on September 22, its Division of Market Oversight put out an advisory flagging elevated manipulation risks in mention markets, which are contracts that settle based on whether a particular person says a particular thing. That advisory bears on how those contracts meet listing requirements.
Who's watching
Kalshi and Polymarket both operate as CFTC-registered designated contract markets for event contracts, and Crypto.com and Robinhood offer similar products. They're the platforms most directly exposed to whatever comes out of OMB.
So who gets to regulate prediction markets, Washington or the states? The CFTC's position, as Crypto Briefing reported it, is that the agency holds exclusive jurisdiction over event contracts under the Commodity Exchange Act. The states' position is being argued in court, with Ohio and Tennessee in litigation and New Jersey's attorney general asking the Supreme Court to weigh in.
Frequently asked questions
Are the CFTC's new prediction market rules in effect?
No. The CFTC submitted the two event contract rules to the White House Office of Management and Budget for review on September 30, 2026, according to Crypto Briefing. Both still need to pass that review, and the proposed rule would go through its own process before becoming final.
What is an interim final rule?
Agencies typically use an interim final rule when they want a rule to take effect while public comments are still being gathered. The CFTC's interim final rule would exclude casino-style gambling products from being classified as swaps, per Crypto Briefing. It still needs to clear White House review.
Why are states fighting the CFTC over prediction markets?
The CFTC maintains it holds exclusive jurisdiction over event contracts under the Commodity Exchange Act. Ohio and Tennessee have argued that sports event contracts violate their state gambling laws and are in litigation with the agency, according to Crypto Briefing. New Jersey's attorney general has asked the Supreme Court to review the jurisdictional question.
