CFTC Plans to Bring Event Contracts Under Derivatives Regulation

On October 10, according to CoinDesk, the U.S. Commodity Futures Trading Commission (CFTC) recently issued an interim final rule alongside another proposal aimed at formally bringing "event contracts" from both the crypto and traditional sectors under the regulatory framework for "swaps." Spearheaded by CFTC Chairman Mike Selig, the initiative aims to establish contracts tied to sports, political, cultural, and weather-related events as financial products falling under the exclusive jurisdiction of federal regulators.

Under the new definition, casino-style gambling is not considered a type of swap transaction and is explicitly excluded from the commission's jurisdiction. Instead, event contracts traded on platforms such as Polymarket and Kalshi fall squarely within this definition. The newly issued interim final rule takes effect immediately and is open for public comment, whereas the proposal to fully incorporate these contracts into the existing derivatives regulatory framework has a 30-day comment period.

This move comes amid intense jurisdictional disputes between the CFTC and several state governments. Previously, some states had joined former government officials in filing briefs with the U.S. Supreme Court, and federal rulings have already gone against the CFTC. This administrative redefinition of compliance boundaries is viewed as a key move for the CFTC to bolster its legal standing in the ongoing litigation battle.