The US Commodity Futures Trading Commission has withdrawn a 2024 proposal that aimed to ban political and sports-related prediction markets, reversing a key regulatory effort from the Biden administration. The agency also rescinded a staff advisory that had warned firms about litigation risks tied to offering event contracts.
CFTC Chair Michael Selig said the earlier proposal reflected an attempt at merit-based regulation that went beyond the commission’s statutory mandate. By formally abandoning the framework, the agency confirmed it will not pursue final rules based on categorizing prediction markets as gaming activities. Instead, the CFTC plans to develop new rulemaking grounded in the Commodity Exchange Act and aligned with congressional intent.
The move provides regulatory clarity for platforms offering event contracts, including federally regulated venues. However, state-level legal challenges remain a key risk, with jurisdictions such as Nevada continuing to argue that certain prediction markets resemble unlicensed gambling.
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