The White House's Office of Information and Regulatory Affairs is currently assessing a proposed rule from the Commodity Futures Trading Commission (CFTC) concerning prediction markets, which could significantly influence the operations of platforms like Kalshi and Polymarket nationwide.
A recent entry on RegInfo.gov indicates that the proposal was submitted to the regulatory office on May 26, triggering a review process as outlined under Executive Order 12866. The details of the proposed rule regarding “Prediction Markets” have not been disclosed in the filing.
This step is one of the clearest indicators that the CFTC is moving towards establishing a comprehensive federal regulatory framework for event contracts, following prolonged legal and political disputes related to sports and election markets.
States such as Illinois and New Jersey contend that event contracts associated with sports essentially operate as online betting markets. In contrast, Kalshi and the CFTC argue that these designated contract markets, governed by federal commodities law, fall under the agency's exclusive jurisdiction.
The executive order mandates that significant federal regulations undergo scrutiny before being published, requiring agencies to submit key rules for economic and policy evaluation. The Office of Information and Regulatory Affairs, part of the Office of Management and Budget, manages this review process.
This review comes shortly after President Donald Trump publicly expressed his support for the CFTC's authority over prediction markets, describing it as “critically important” for the agency to maintain “exclusive authority” in this area in a post on Truth Social.
The current proposal follows a March advance notice of proposed rulemaking in which the CFTC sought input on potential prohibitions of certain prediction market contracts deemed “contrary to the public interest,” specifically those related to elections, gaming, and sports.