CFTC moves to allow sports betting, bar war wagers on prediction platforms
Federal regulators are preparing to allow most sports betting on prediction market platforms while blocking wagers on war and other controversial topics, according to a Wednesday report. The proposed action targets platforms including Kalshi and Polymarket, the federally regulated venue where users can bet on various outcomes. Kalshi, described as a fast-moving startup, has drawn Wall Street's attention to prediction markets as regulatory rules remain unsettled. The distinction between permitted sports contracts and barred war-related wagers marks a sharp line the CFTC is drawing in its emerging framework for the sector.
Kalshi and Polymarket must now calibrate two product pipelines at once: expanding sports event contracts the CFTC would greenlight while sunsetting or restructuring war markets the same rule would prohibit. Any miscalculation triggers forced delisting and trader make-whole costs.
The CFTC's proposed stance on sports versus war contracts fits within its broader June 10 rulemaking on event contracts, with platforms now juggling comment-period lobbying and active state litigation simultaneously.