CFTC and Division of Market Oversight Issue Releases on Prediction Markets and Event Contracts, Global Relay Intelligence & Practice

Partners Stacie Hartman and Robert A. Schwartz and associate Nikita Cotton co-authored an article for Global Relay Intelligence & Practice examining the US Commodity Futures Trading Commission’s recent actions on prediction markets, including an advance notice of proposed rulemaking and new staff guidance that provide an early indication of the agency’s regulatory priorities.

The authors analyze how the CFTC is approaching issues such as market integrity, insider trading, contract design, and the role of designated contract markets in overseeing event contracts. They explain that, rather than pursuing a broad regulatory overhaul, the Commission appears focused on applying existing legal frameworks while relying on exchanges’ self-regulatory obligations to address emerging risks. The article also highlights key considerations for market participants, including sports event contracts, manipulation concerns, and the prospect of future guidance on the distinction between swaps and security-based swaps.

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