A Commodity Futures Trading Commission committee meeting exposed a sharp divide between the worlds of traditional finance and prediction market platforms and how the rapidly growing sector should be regulated.
On Thursday during a CFTC Innovation Advisory Committee meeting, CME CEO Terrence Duffy raised concerns about prediction-market contracts, arguing that some markets are vulnerable to manipulation. Duffy has previously called for greater oversight, as CME has embraced the sector — its derivatives exchange has launched more than 100 million event contracts since launching them last year.
Duffy said he was particularly concerned about the number of contracts that have been self-certified and the potential for manipulation in certain markets, including contracts tied to what President Donald Trump would say during his State of the Union address and when Venezuelan President Nicolás Maduro would be ousted.
"There are definitely people that are manipulating these contracts," Duffy said. "That is not good for our industry. That is horrible for our industry."
Duffy pointed to Trump’s goal of making the U.S. the “crypto capital of the world,” arguing that markets susceptible to manipulation could undermine that effort.
