CFTC Chairman Mike Selig just released the agency's first proposed rule for prediction markets, and it sets a 90-day clock for determining whether contracts are in the public interest. That clock starts the moment a contract is submitted for review.
What the Rule Actually Scrutinizes
Federal law already bans contracts involving war, terrorism, assassination, illegal activity, and gaming. Selig's proposal doesn't change that—it gives the CFTC a formal process to evaluate each contract against those categories. The agency has been relying on exchanges (Kalshi, Polymarket, Crypto.com) to self-police; now it wants a centralized stamp of approval.
Selig's statement makes the intent clear: "The CFTC will protect the integrity of our regulated markets without standing in the way of responsible innovation." Translation: they want to keep the industry growing, but with a leash they can yank.
The Sports Betting Loophole Is Explicit
Sports betting is effectively blessed. The CFTC has already signed data-sharing agreements with professional sports leagues, and this rule formalizes that stance. If you're building a market on the Super Bowl or the World Series, you're in the clear. Political betting and financial event contracts? Still in the gray zone—those haven't been flagged as per se illegal, but they'll face the 90-day test.
President Trump weighed in via social media, saying "Other Countries are after this new form of Financial Market, and we want to remain at the top." That's as clear a political signal as the CFTC could hope for.
90-Day Review: Real Teeth or Process Theater?
The proposal gives the CFTC 90 days to decide whether a contract is in the public interest. If they miss the deadline, the contract can proceed—which creates an incentive for the agency to move fast or lose control. Exchanges remain the first line of defense, but now every new contract is subject to a federal review that can kill it.
What's missing from this proposal is any detail on how the CFTC will handle the sheer volume of contracts. Kalshi alone lists hundreds of event markets. Polymarket's election books have thousands of binary outcomes. A 90-day queue for every one of those would grind the industry to a halt unless the CFTC builds a fast-track system.
If the CFTC can stick the landing on this framework, it gives exchanges like Kalshi and Polymarket a predictable path forward—and sets a precedent other regulators will have to reckon with.
Source: Prediction markets get first U.S. rule proposal as CFTC pursues contract reviews
Domain: coindesk.com
Comments load interactively on the live page.