CFTC Submits Prediction Market Rules Changes to White House

The CFTC is redefining its rulebook

The CFTC sent two proposals relating to event contracts to the White House Office of Information and Regulatory Affairs (OIRA). That is a division operating within the Office of Management and Budget. Its purpose is to review federal regulations before publication,

The first rule was titled “Further Definition of ‘Swap’ to Include Event Contracts." This rule is designed to firmly include event contracts within that definition. The second rule covers the “Further Definition of ‘Swap’ to Exclude Casino-Style Gambling Products.”

This process began in March. That was when the CFTC issued an advance notice of proposed rulemaking. They were seeking public feedback on how to regulate event contracts. These submissions are part of a coordinated federal strategy. It's designed to assert and defend CFTC jurisdiction over prediction markets in multiple states where legal fights are ongoing.

In these court cases across multiple states, the CFTC argues that the Commodity Exchange Act provides it with exclusive jurisdiction over event contracts traded on registered designated contract markets (DCM). In those states, the state regulators insist that prediction market sites must adhere to state gambling laws. However, the CFTC argues that these state laws are preempted when states seek to regulate or ban prediction market event contracts.

President Trump is endorsing the CFTC in this fight

U.S. President Donald Trump continues to offer strong support to the CFTC in its fight against state regulators.

"It is critically important that the CFTC's exclusive authority over prediction markets is maintained, and that they will thrive," Trump wrote in a post on Truth Social.

The Trump family has a vested interest in the ongoing success of prediction market sites.

Donald Trump Jr. was named a strategic advisor to Kalshi in 2025. As part of this arrangement,  he was the recipient of a $300,000 equity stake in the company. According to reporting by the Financial Times, that equity stake is now worth as much as 10 times that amount. According to Kalshi, Trump advises the company in the areas of growth, market strategy, and partnerships.

He was also added to the Polymarket advisory board. This move came after the investment firm 1789 Capital sunk money into the prediction market platform. Trump is a partner in 1789 Capital.

A government watchdog is questioning the CFTC's motives

The American Economic Liberties Project, a non-profit and non-partisan government watchdog organization, is questioning the motives of the CFTC in pushing through these rule changes.

“It is clear to anyone paying attention that prediction markets are just a cover for gambling,” said Ashley Nowicki, a senior policy analyst at the American Economic Liberties Project. “Calling a bet a ‘swap’ or a prediction doesn’t change what it is.

"The CFTC is attempting to put its thumb on the scale in a battle over legal definitions, before the Supreme Court can weigh in.”