The Commodity Futures Trading Commission (CFTC) issued a no-action letter on Thursday that streamlines swap data reporting and recordkeeping requirements for event contract operators. The relief applies to all existing beneficiaries of previous no-action letters and creates a single process for new entrants to request identical treatment without individual guidance. The CFTC acknowledged that event contracts, which are binary-outcome instruments popular on prediction markets, technically qualify as swaps but function more like futures due to highly-standardized terms, exchange-trading protocols, fungibility, and offset. This classification allows operators to use simpler reporting formats designed for futures rather than complex swap documentation. The 19 named beneficiaries include Polymarket US, Kalshi, Gemini Titan, and Bitnomial, representing a cross-section of crypto-native platforms and traditional derivatives exchanges. The move comes amid jurisdictional disputes between the CFTC and states over prediction market regulation, with CFTC Chair Michael Selig vowing to sue states that attempt to regulate under local gambling laws, arguing that unclear regulation could drive platforms offshore.

Key facts

• CFTC no-action letter eliminates individual approval for event contract data reporting.
• 19 platforms including Polymarket US, Kalshi, and Gemini Titan benefit from streamlined process.
• Event contracts classified as swaps but allowed to report like futures.
• CFTC Chair vows to sue states regulating prediction markets under gambling laws.
• Move aims to prevent offshore migration and ensure regulatory clarity.