The US Commodity Futures Trading Commission (CFTC) is backing prediction markets, with Chairman Mike Selig asserting the agency's exclusive jurisdiction over these platforms. This move is seen as a significant development, potentially paving the way for wider adoption and regulation of prediction markets in the US.
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*Key Points:*
- *CFTC's Stance*: The CFTC views prediction markets as derivatives, subject to federal regulation, rather than gambling, which falls under state jurisdiction.
- *Legal Challenges*: The CFTC is facing opposition from 23 US senators who argue that prediction markets are akin to sports betting and should be regulated by states.
- *Impact on Platforms*: The CFTC's backing could benefit platforms like Kalshi, Polymarket, which offer event contracts to US traders.
- *Regulatory Framework*: The CFTC is working on new rules to provide clarity on prediction market regulation, which could lead to increased legitimacy and adoption.