CFTC Grants Prediction Markets Flexibility on Data Reporting and Record-keeping Rules

The Commodity Futures Trading Commission has issued “no-action” letters to several prediction market platforms, granting leeway on requirements tied to swap data reporting and record-keeping. In a statement Thursday, the CFTC’s Division of Market Oversight and Division of Clearing and Risk said staff will not initiate enforcement action over those specific obligations, provided each platform follows a set of conditions.

Regulators stressed the scope is narrow and applies only in limited circumstances.

To remain covered, platforms must fully collateralize every contract, meaning positions must be completely backed by assets held in reserve. They must also publish time and sales data for all event contract transactions on their websites after trades are executed, according to the letters.

Prediction markets and event contracts let users take positions on outcomes ranging from sports to niche cultural and political questions. Because these products are regulated in the US as designated contract markets, operators can face extensive documentation requirements. The no-action relief gives certain platforms breathing room if they fall short on the specified rules, as long as they meet the CFTC’s terms.

A no-action letter does not change the underlying law. It signals that CFTC staff will not recommend enforcement for defined conduct under defined conditions, often as a temporary step while a market structure evolves.

The move comes as prediction markets surge. DeFiLlama data shows Kalshi at about $5.14 billion in volume over the past 30 days, versus roughly $1.9 billion for crypto-based Polymarket. Competition is rising too, with Crypto.com launching a prediction market product and signs that Coinbase is exploring its own platform.