The Commodity Futures Trading Commission told prediction markets to avoid using American-style gambling odds as the US regulator fends off legal challenges alleging the platforms are illicit sports betting operations.
The agency sent a warning to CFTC-regulated entities reminding firms they need to comply with U.S. laws governing derivative trades and not use “deceptive” practices to list, solicit or advertise the products, according to a letter viewed by Bloomberg.
The CFTC specifically called out as prohibited the use of American-style gambling odds to market a wager. Sports betting apps often label bets with a plus (+) or minus (-) sign followed by a number representing how much a gambler can win if they bet a certain amount.
