CFTC and SEC seek public comment on swaps definition amid CME lawsuit
The Commodity Futures Trading Commission and the Securities and Exchange Commission issued a joint request for public comment on defining swaps and classifying novel products, including event contracts on prediction markets. The request was published June 18 and comes amid an ongoing lawsuit between CME Group and the CFTC. Crypto.news reported that Atkins earlier told lawmakers some event contracts may fall under securities law depending on how they are written. The agencies are also seeking feedback on perpetual futures. The same day, CME sued the CFTC over its approval of Kalshi's perpetual futures as futures rather than swaps, signaling continued jurisdictional tension between the regulators over how to classify emerging financial instruments.
Kalshi now faces simultaneous assaults on two product lines: CME's lawsuit over its perpetual-futures classification and a potential SEC jurisdictional grab on event contracts if the joint rulemaking reclassifies them as securities. Either outcome would force Kalshi to restructure or withdraw products mid-market.
This is the third recent CFTC action bearing directly on Kalshi's product authority, after the agency approved Kalshi's bitcoin perpetual futures and CME filed suit to block that approval. CME's lawsuit against the CFTC over Kalshi's product classification now runs parallel to the definitional rulemaking the two agencies just opened for comment.