The U.S. Commodity Futures Trading Commission has sent two proposals to the White House for review that could reshape the legal status of prediction-market event contracts, including sports-related products traded on platforms such as Kalshi. The moves come as the federal regulator contests state claims that some of those contracts are gambling products subject to state oversight.
CFTC seeks a broader definition
According to CoinDesk, the CFTC submitted the proposals to the White House Office of Management and Budget this week. The disclosures, dated September 28, concern two related rules and represent an important step before proposed regulations are submitted for public comment.
One proposal would expand the federal definition of a “swap” to include event contracts. These products generally offer a binary yes-or-no outcome tied to a measurable event, such as the result of a sporting contest or an election. A swap, in financial regulation, is an instrument in which two parties agree to exchange value according to defined terms.
The second measure is described as an interim final rule. It would remove “casino-style gambling products” from the types of instruments that can qualify as swaps. Unlike a standard proposal, an interim final rule can take effect immediately while remaining open to public comments and possible revision.
The CFTC said neither submission is “economically significant,” according to the White House disclosures. The filings did not include the detailed text of either rule, so the precise language and scope of the measures are not yet public.
A widening dispute with states
The proposals reflect the CFTC’s effort to establish itself as the federal regulator with primary authority over prediction markets and the event contracts traded on them. Platforms mentioned in connection with these products include Kalshi, Polymarket, Crypto.com and Robinhood.
States have challenged that position, particularly in relation to sports-linked contracts. Their argument is that such products are unregulated gambling and therefore fall under state gambling laws. Kalshi has been a frequent target of lawsuits alleging that it operates an illegal gambling platform in states where those products are offered.
The CFTC’s proposed approach would directly challenge that interpretation. If event contracts were formally treated as swaps, and swaps were separated from gambling products in the regulatory framework, the states’ position could be weakened in a broad range of cases.
The dispute has already produced conflicting decisions in federal courts. The latest rulings cited in the source material came from the Sixth and Eighth U.S. Circuit Courts of Appeals, which found that sports contracts traded on Kalshi are not swaps and are subject to state gambling regulations. The Third Circuit, however, reached a different conclusion, ruling that the CFTC had proper jurisdiction over prediction markets.
The split among federal appellate courts raises the possibility that the U.S. Supreme Court could eventually be asked to resolve the issue. Meanwhile, the CFTC has actively participated in the litigation, including by suing states while defending what Chairman Mike Selig has described as the agency’s sole jurisdiction over prediction markets.
Leadership and related regulatory work
The CFTC is legally structured as a five-member commission, but President Donald Trump has not nominated additional commissioners so far. Selig is therefore its only member and has been acting alone on regulatory and policy decisions.
The White House disclosures also show that the CFTC recently submitted a separate “prerule” concerning cryptocurrency regulation. The agency did not provide details about the substance of that effort.
The two event-contract measures now face the White House review process. If they proceed, the public-comment stage would give market participants, states and other interested parties an opportunity to respond before any final regulatory framework is established.
Current market picture
Moneyiar market data at 08:58-08:59 on October 1, 2026, showed mixed performance among the listed digital assets:
- OriginTrail (TRAC) traded at $0.5000035786, up 24.54% over 24 hours and 39.29% over seven days.
- Sentient (SENT) was at $0.0220675006, gaining 4.07% in 24 hours and 3.08% over seven days.
- Basic Attention Token (BAT) stood at $0.089308833, down 1.37% over 24 hours and 0.69% over seven days.
- RedStone (RED) traded at $0.1818623124, up 10.3% over 24 hours and 19.86% over seven days.
These market figures are separate from the CFTC’s regulatory action and do not indicate how the proposed rules will affect any particular asset or platform.
