CFTC claims exclusive federal authority over prediction markets in new brief, clashing with states
The CFTC asserted exclusive federal jurisdiction over prediction markets in a court brief, opposing state regulatory efforts.Summary
The U.S. Commodity Futures Trading Commission (CFTC) filed an amicus brief arguing it has "exclusive jurisdiction" over futures, which includes event contracts like those offered by prediction markets, citing the Dodd-Frank Act.
This action directly challenges state regulators, exemplified by a case where Crypto.com's prediction-market arm sued Nevada after a judge ruled sports-event contracts fell under state gaming laws. CFTC Chair Michael Selig called state intervention a "power grab," asserting that these contracts are commodity derivatives squarely within the agency's remit, offering investor protections that differ from traditional gambling.
While the CFTC recently scrapped a proposal to ban certain event contracts, state officials, including Utah Governor Spencer Cox, maintain that prediction markets are gambling and are undermining state regulatory regimes. Conversely, some lawmakers, like Senator Bill Hagerty, support the CFTC's move to establish clear federal rules for innovation.
(Source：The Block)