Regulations
By Bruce Buterin
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What "Swap" Classification Actually Means for Platforms. Treating event contracts as derivatives under federal law drags platforms into a compliance…
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States vs. Federal Authority — and Who's Winning. Here's where it gets messy. The CFTC's push for federal oversight runs directly into a wall of…
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The CFTC just made its move. The agency submitted its prediction market proposal to the White House Office of Management and Budget, officially launching the federal rulemaking…
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The exact text of the proposal hasn't been made public yet. But the direction is pretty clear from what CFTC officials have said over the past several months.
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Swaps mean full compliance. Full compliance means money, lawyers, and infrastructure.
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Treating event contracts as derivatives under federal law drags platforms into a compliance framework most of them weren't originally built for.
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Some platforms have already started moving in that direction — and the enforcement record backs it up. Kalshi penalized three U.S.
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The CFTC also charged a Google employee for allegedly trading on Polymarket using non-public information.
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Read also: Google Engineer Faces DOJ and CFTC Charges Over $1.2M Polymarket Insider Trading Scheme
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The White House is backing the CFTC's position. Former President Trump called prediction markets a "major industry" and warned that a patchwork of state regulations could hurt U.S.
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But states aren't backing down quietly. Several of them have ongoing legal and regulatory actions that directly conflict with what the CFTC is trying to build.
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For financial firms that are already in the prediction market space — or thinking about entering — the outcome of this fight matters enormously.
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The broader fintech industry is watching closely. Prediction markets have grown fast, and the question of whether they sit inside or outside traditional financial regulation has…
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More context: DraftKings DKeX Files CFTC Event Contract Templates Covering 9 Sports
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It's also worth noting that the compliance bar being set here — KYC, trade surveillance, insider trading controls — isn't dramatically different from what regulated crypto…
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