- The CFTC has proposed new rules, stating sports event contracts are generally not contrary to the public interest despite being classified as “gaming” under federal law.
- The proposal clarifies that election contracts are not considered gaming, easing regulatory uncertainty for platforms like Kalshi and Polymarket.
- Prediction markets are seeing a surge in adoption and institutional interest, with these platforms reaching multibillion-dollar valuations and forging major partnerships.
On June 10, 2026, the US Commodity Futures Trading Commission (CFTC) released a pivotal proposal for prediction markets, signaling a significant shift in regulatory perspective. The draft proposal distinguished these markets from games of pure chance, finding that contracts based on final scores or win-loss records can aid price discovery.
However, contracts tied to player injuries or officiating decisions are unlikely to meet the public interest test due to manipulation risks. Consequently, the rules clarify that election contracts are not considered “gaming” under relevant federal laws. Reuters reported this could further ease uncertainty for platforms like Kalshi and Polymarket.
Attorney Gary Kalbaugh noted the proposal is principles-based rather than a blanket approval, with each contract subject to case-by-case analysis. He wrote, “‘Gaming’ is defined more broadly than anticipated and sweeps in sports events” on his LinkedIn.
Meanwhile, prediction markets continue to gain mainstream momentum as an “asset class.” Kalshi recently partnered with Nasdaq to launch markets forecasting private company valuations, while Polymarket partnered with Dow Jones to integrate data into its media brands.
Professor Melinda Roth said, “The prediction markets continue to become more mainstream.” Analysts at Bernstein cite growing institutional adoption as investors seek alternative macro-hedging tools.
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