CFTC event-contract proposal closes with 1,500+ comments as states and platforms clash
The March 2026 rulemaking drew split demands on sports markets and calls to bar election and geopolitics contracts.
The CFTC’s public comment window on its March 2026 proposal to revise oversight of prediction-market “event contracts” has closed with more than 1,500 submissions. The feedback split along a familiar fault line: platforms and crypto-aligned stakeholders pushing for exclusive federal jurisdiction, and state gambling regulators and consumer groups pressing for tighter limits.
Key Takeaways
- More than 1,500 public comments hit the CFTC’s inbox on its event-contract rulemaking, with respondents split on how aggressively prediction markets should be policed.
- The proposal was issued in March 2026, and the comment period ended Thursday.
- Sports prediction offerings have already triggered lawsuits naming Kalshi, Polymarket, and Coinbase, while the CFTC has sued at least five state governments tied to state-level actions.
- State regulators urged the CFTC to drop support for sports event contracts, while Better Markets and 12 other consumer groups pushed to prohibit election- and geopolitics-linked contracts.
1,500+ Comments Close Out the CFTC’s Event-Contract Proposal
The US Commodity Futures Trading Commission has closed the public comment period on its March proposal to amend or issue new regulations for prediction-market “event contracts.” The docket drew more than 1,500 responses by the Thursday deadline, spanning prediction-market operators, crypto firms, consumer advocates, and state gambling regulators.
The split is not just about enforcement intensity. It is about what the product is, who gets to regulate it, and whether certain categories should exist at all under a CFTC framework.
Kalshi co-founder and COO Luana Lopes Lara submitted a letter on Thursday backing the agency’s existing approach, calling current regulations “well-designed and effective,” and urging guidance so “that the universe of event contracts can continue to be listed, traded, and overseen by the Commission.”
The Jurisdiction Fight: CFTC Authority vs State Gambling Regulators
The rulemaking is turning into a federal-versus-state jurisdiction fight because state regulators are directly disputing the CFTC’s authority over sports-linked contracts while platforms are arguing the opposite.
State gambling officials in Pennsylvania, Tennessee, and Missouri urged the CFTC to drop support for sports event contracts. Pennsylvania Gaming Control Board Executive Director Kevin O’Toole said the CFTC was allowing prediction markets “to masquerade as unregulated sportsbooks.” Tennessee Sports Wagering Council Executive Director Mary Beth Thomas said the council disputes “that sports event contracts offered on prediction markets fall within the jurisdiction of the CFTC at all.” Missouri Gaming Commission Executive Director Michael Leara argued Congress “did not intend futures markets to encompass gambling activities,” and urged the CFTC to “properly reserve jurisdiction over sports event contracts for the states.”
For traders, the practical risk is access fragmentation. If states keep asserting gambling authority, platforms can face a patchwork of restrictions even while the federal rulebook is still being written.
Industry Push: Kalshi, Polymarket, and Others Argue for Exclusive Federal Oversight
On the other side, prediction-market operators and aligned stakeholders are pressing for a clean “exclusive jurisdiction” outcome where the CFTC is the primary gatekeeper.
Polymarket US CEO Justin Hertzberg praised CFTC Chair Mike Selig for “asserting the CFTC’s longstanding exclusive jurisdiction over prediction markets,” and said the regulator “should continue to exercise its exclusive jurisdiction over prediction markets.” Venture firm Andreessen Horowitz argued that “state actions to regulate or ban prediction markets impose a serious barrier to impartial access,” framing state intervention as a market-access problem for CFTC-regulated products.
The legal posture is already moving beyond comment letters. Kalshi, Polymarket, and Coinbase are among companies sued over sports prediction market offerings. The CFTC has backed the “sole authority” theory by suing at least five state governments connected to state actions against prediction markets, raising the odds that final rules and litigation run in parallel.
Where the Pushback Concentrates: Sports, Elections, and Geopolitics
Sports markets remain the headline battlefield, but the most immediate category-level restriction risk sits with elections and geopolitics because consumer groups are explicitly asking for prohibitions.
Better Markets CEO Dennis Kelleher and 12 other consumer groups urged the CFTC to “prohibit event contracts that involve elections or geopolitical events,” arguing such contracts could influence government actions. Separately, prediction markets have drawn scrutiny from some federal lawmakers over contracts tied to geopolitical events and the potential use of insider knowledge.
Kalshi and Polymarket said last week they tightened insider-trading controls and ban or restrict certain users, including politicians, after the US Senate passed a ban on its members and staff using prediction markets.
The next leg is procedural and political. The market is waiting for any CFTC signal on whether sports event contracts will be explicitly permitted, limited, or carved out, and whether the agency is considering bans on election- or geopolitics-linked contracts. Traders also need a timeline for moving from proposal to final rules, plus updates in the state-level legal fights that are already shaping platform risk.
Marcus Hale’s Take: This Comment Split Raises the Probability of a Narrower Rulebook
I don’t see this as a clean “clarity is coming” setup. The threshold that matters is whether the CFTC writes rules that keep sports contracts inside the tent while still giving states enough room to claim gambling authority. With state regulators openly disputing jurisdiction and the CFTC already suing states, the real test is whether the agency can narrow definitions without triggering more venue fights.
This looks more like a sentiment catalyst than a fundamental shift until the CFTC shows its hand on carve-outs. If election and geopolitics contracts get singled out for prohibition while sports stays in limbo, liquidity will migrate to whatever venues can still list the highest-demand markets under the least contested authority, and that is when this development starts to matter in practical terms.
