CFTC sends prediction market rules to the White House for review

The Commodity Futures Trading Commission wants the final word on prediction markets. It just sent the White House two rules to help make that happen.

On September 30, 2026, the CFTC submitted a pair of event contract rules to the White House Office of Management and Budget for review. Together, they amount to the agency’s clearest attempt yet to claim prediction markets as federal territory, not state turf.

The timing is not subtle. Several states are fighting the agency in court over whether sports-linked contracts are just gambling in a trench coat.

Two rules, one message

The first measure is a proposed rule. It would amend the regulatory definition of a “swap” so that it explicitly covers event contracts, the yes-or-no products that prediction markets run on.

Why does the swap label matter? Swaps fall under the Commodity Exchange Act, the federal law the CFTC administers. Writing event contracts into that definition would anchor them more firmly inside the agency’s rulebook.

The second measure is an interim final rule, and it cuts the other way. It would exclude “casino-style gambling products” from being classified as swaps at all.

An interim final rule is an unusual tool for this kind of line-drawing. Agencies typically use it when they want a rule to take effect while public comments are still being gathered, rather than waiting for the full notice-and-comment cycle to finish.

Both rules reinforce the position the CFTC has held throughout the dispute. The agency maintains that it holds exclusive jurisdiction over event contracts under the Commodity Exchange Act.

The states are not convinced

That claim of exclusivity is exactly what several states reject. Ohio and Tennessee have argued that sports event contracts violate their state gambling laws, and they have taken that fight into litigation with the agency.

New Jersey has pushed things further up the ladder. The state’s attorney general has asked the Supreme Court to review the jurisdictional question.

This latest move also builds on earlier work from the commission this year. In June, the CFTC issued a notice of proposed rulemaking that sought public comment on how to assess event contracts tied to specified activities, including gaming.

Then, on September 22, the CFTC’s Division of Market Oversight put out an advisory flagging elevated manipulation risks in so-called “mention markets.” These are contracts that settle based on whether a particular person says a particular thing. The advisory bears on the listing requirements for these contracts.

Who is in the arena

The rules land in a market that has grown crowded. Kalshi and Polymarket both operate as CFTC-registered designated contract markets for event contracts, meaning they are federally supervised exchanges rather than offshore curiosities.

They are not alone. Crypto.com and Robinhood offer similar products, widening the menu of places where traders can take a position on real-world outcomes.

What this means

The casino-style carve-out creates a new question: where exactly does an event contract end and a casino-style product begin? Sports contracts sit uncomfortably close to that line, and the states suing the CFTC are likely to probe it hard.

For the states, the rules raise the pressure. If the OMB review clears and the rules move forward, Ohio, Tennessee, and others may find themselves arguing not just against the agency’s interpretation but against its formal regulations.

There are real limits to what these rules can settle on their own. They still need to pass White House review, and the proposed rule would go through its own process before becoming final.

New Jersey’s request for Supreme Court review means the highest court could eventually weigh in on the jurisdictional question, and a ruling there could reshape the landscape regardless of what the CFTC writes into its rules.