Washington, D.C., October 9, 2026. The US Commodity Futures Trading Commission (CFTC) introduced two regulatory measures to strengthen its authority over prediction markets, including sports, political, cultural, and weather-related contracts, amid ongoing legal disputes with state regulators involving platforms such as Kalshi and Polymarket.
Kalshi ruling reshapes future of prediction markets
CFTC Chairman Michael S. Selig announced, through press release 9310-26, a proposal to explicitly include these contracts within the federal definition of a swap under Section 1a(47) of the Commodity Exchange Act (CEA). The measure seeks to recognize them as financial derivatives subject to federal oversight, distinguishing them from conventional gambling activities.
Simultaneously, press release 9309-26 established an interim final rule excluding traditional casino gambling and sportsbook wagers from that classification. The rule will take effect upon publication in the Federal Register. Both measures provide 30-day public comment periods through Regulations.gov.
The documents were submitted on September 28 to the Office of Information and Regulatory Affairs (OIRA), part of the Office of Management and Budget (OMB), for regulatory review.
Shayne Coplan
The dispute pits the CFTC against state authorities, while the National Football League (NFL) supports Supreme Court intervention in Flaherty v. KalshiEX. A coalition of 39 states and the District of Columbia has also requested a review of the scope of federal jurisdiction. The debate involves Polymarket, founded by its CEO Shayne Coplan, and Kalshi, whose sports contracts challenge the boundaries between financial derivatives and regulated betting.
The financial implications are significant: during the NFL’s opening Sunday, US$1.8 billion was reportedly traded in football-related contracts, out of a total trading volume of US$3.3 billion. These figures represent trading activity, not revenue. Section 5c(c)(5)(C) of the CEA maintains restrictions on contracts linked to certain activities. Kalshi is expected to file its judicial response by November 9, while the Supreme Court’s decision on whether to hear the case remains pending.
