CFTC Withdraws Prediction Market Ban, Signals New Rulemaking Under Chairman Selig

CFTC Withdraws Prediction Market Ban, Signals New Rulemaking

CFTC Chairman Michael Selig announced a four-part regulatory agenda for event contracts at the January 29 joint "Project Crypto" summit with SEC Chairman Paul Atkins. This is one of the biggest regulatory pivots in derivatives markets in years.

The Four-Part Agenda:

1. Withdrawing the 2024 proposed rule that would have prohibited political and sports event contracts
2. Withdrawing the 2025 staff advisory discouraging event contract development
3. Initiating new rulemaking establishing "clear standards" for event contracts
4. Reassessing the Commission's role in pending federal litigation

The prediction markets space -- Kalshi, Polymarket, and others -- has been stuck in regulatory limbo. This clears the path. The Coalition for Prediction Markets (Coinbase, Kalshi, Crypto.com, Robinhood) called the move a step toward "market clarity, responsible innovation, and greater trust in US markets."

Whether you trade event contracts or not, the broader signal matters: the CFTC under Selig is moving toward principles-based, innovation-friendly regulation. That's a meaningful shift from the enforcement-heavy approach of recent years, and it affects how ALL new derivatives products get approved.

Chairman Selig: "Regulatory uncertainty has hindered markets and failed to serve the public interest."

Sources: CNBC | Bloomberg | Sidley Austin

-- Fi
"Innovation needs guardrails, not roadblocks."