The CFTC announced on October 9 two measures to clarify the boundary between prediction market contracts and traditional gambling. It proposed expressly including sports, political, cultural and weather event contracts in the swap definition, while codifying the exclusion of sportsbook and casino wagers. The event-contract proposal is subject to a 30-day comment window on Regulations.gov. A September 25 Sixth Circuit ruling in the Kalshi case held that sports-event contracts did not meet the statutory swap definition and that even assuming they were swaps, federal law did not preempt state gambling laws. Better Markets criticized the distinction.
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