CFTC Proposes First-Ever Prediction Markets Rulebook, Would Ban War and Assassination Contracts

Jun 10, 2026

The U.S. Commodity Futures Trading Commission (CFTC) has proposed its first-ever rulebook for prediction markets, aiming to regulate the growing sector. The rules, detailed in a 267-page document, would ban contracts involving war, assassination, and certain sports prop bets like player injuries. The framework establishes a multi-factor test to determine if contracts are in the public interest, while generally protecting wagers on overall sports outcomes.

CFTC prediction markets rulebook

▪The U.S. Commodity Futures Trading Commission (CFTC) proposed its first regulation for prediction markets on June 10, 2026.
▪The proposal is open for a 45-day public comment period before it can be revised and finalized.
▪The proposed CFTC rules for prediction markets are detailed in a 267-page document.
▪President Donald Trump has expressed support for CFTC Chairman Mike Selig's approach to regulating new financial markets.
▪The new rules are set to go into effect within 60 days of their completion.

Contract prohibition categories

▪The proposal would bar certain sports-related prop bets, including those on player injuries, referee calls, specific plays, or physical altercations.
▪The proposed rules would ban wagers on a political leader's removal from office if the outcome could involve war or assassination.
▪The rules would permit markets on a leader's ouster only if they specify non-violent outcomes like electoral defeat, resignation, or natural death.
▪Federal law allows the CFTC to prohibit contracts involving war, terrorism, assassination, or illegal activity if they are deemed outside the public interest.

Public interest determination framework

▪The CFTC views regulated exchanges as the first line of defense in determining if contracts are legal and markets are not manipulated.
▪The CFTC proposal uses a three-part test and a 90-day review process to determine if individual contracts are in the public interest.
▪The CFTC will use a multi-factor approach to weigh a contract's potential harm against its public benefit, such as hedging or price-basing utility.

Sports betting protection

▪Multiple states have filed federal lawsuits arguing that sports-related prediction markets are a form of betting that should be regulated at the state level.
▪The CFTC has indicated that contracts based on overall sporting event outcomes, like final scores or win-loss results, are likely in the public interest.
▪The CFTC believes sports event markets can serve price discovery functions and provide meaningful information.

Commission vacancy concerns

▪Legal observers have suggested the CFTC's policy work could be legally challenged because the commission is not at full strength.
▪The five-member CFTC is currently operating with only one chairman, Mike Selig, and four vacant commissioner seats.