The Commodity Futures Trading Commission released its proposal for new federal rules related to prediction markets and outlined some contracts that would likely not be approved under the guidelines.The CFTC as a federal agency has come more into focus in recent months and years because it is tasked with regulating prediction markets, which have surged in popularity.
This week, the CFTC released a 267-page notice of proposed rulemaking for prediction markets. Notably, the CFTC’s proposal doesn’t ban any single category of trade, such as contracts for elections or sports.
But while every contract is subject to individual determination, the CFTC indicated that certain transactions are likely to be found contrary to the public interest.
“The CFTC will protect the integrity of our regulated markets without standing in the way of responsible innovation,” CFTC Chairman Michael Selig said. “This proposal gives the Commission a durable, transparent framework to identify the contracts Congress directed us to scrutinize while letting legitimate markets move forward.”
The background
