The Commodity Futures Trading Commission is moving beyond defending prediction markets from state regulators and is working to establish a permanent federal framework for the rapidly expanding industry.
CFTC chairman Michael Selig outlined a three-part prediction market agenda at last week’s Innovation Advisory Committee meeting that would define the event contracts subject to heightened scrutiny, modernize reporting requirements, and introduce new consumer protection and market-design standards. The roadmap comes as traditional sportsbook operators enter prediction markets, established exchanges question the safeguards employed by newer competitors, and state regulators continue trying to apply their gambling laws to sports event contracts.
“We have a lot of work ahead of us at the CFTC, but we’re energized by the innovation that’s happening in our markets,” Selig said.
