The U.S. Commodity Futures Trading Commission has issued a second warning this year to prediction-market operators over broad, template-style self-certifications for event contracts. Summary CFTC told prediction markets that template certifications cannot replace contract-specific terms, analysis, and compliance reviews. The July advisory follows a March warning as event-contract listings and trading activity continue expanding. Proposed rules would apply a three-step public-interest review to gaming, war, terrorism, and assassination contracts. The agency’s Division of Market Oversight said registered exchanges must provide the terms, settlement method, data sources and compliance analysis for each contract they plan to list. Meanwhile, the July 24 advisory does not remove the self-certification route. Designated contract markets can still list event contracts without waiting for prior Commission approval when they meet the Commodity Exchange Act and CFTC rules. However, the agency said one filing cannot cover an open-ended set of possible contract variations without enough product-level detail. CFTC rejects cookie-cutter event-contract filings The CFTC said some exchanges had submitted broad certifications covering many possible versions of an event contract. Those filings did not always include the terms and conditions for each version or a short explanation of the underlying commodity and legal compliance. The agency said that approach limits staff’s ability to review settlement rules, source data and manipulation controls. In its latest guidance, the regulator stated that “broad, template-style certifications should not be submitted.” Closely related contracts may still qualify for one class filing under specific CFTC rules. Exchanges can also request formal approval. Even then, the submission must describe the covered products clearly enough for staff to assess each proposed contract. Second advisory follows March compliance warning The latest notice follows a March 12 advisory issued as prediction markets expanded their sports, political, economic and current-event offerings. That earlier notice reminded exchanges that they act as front-line regulators. It also directed them to review whether contracts could be manipulated, whether settlement sources were reliable and whether product submissions met CFTC requirements. The March guidance also addressed sports contracts, which remain at the centre of disputes between federal derivatives regulators and state gambling authorities. The CFTC says federal law gives it authority over swaps and futures listed on registered contract markets. Several states argue that some sports products operate like gambling and must follow local licensing and consumer-protection rules. Proposed rule would create three-step review The new certification warning arrived days before the July 27 comment deadline for the CFTC’s proposed amendments to Rule 40.11. The proposal would create a three-step process for contracts tied to activities named in the Commodity Exchange Act. Those activities include unlawful conduct, terrorism, assassination, war and gaming. Under the proposed test, the Commission would determine whether a product is an event contract and whether its settlement depends on one of those listed activities. If both tests are met, the agency would apply public-interest factors before deciding whether to block listing or clearing. The proposal would also define “gaming,” clarify the word “involve” and structure the existing 90-day review period. Law firm Ropes & Gray said the plan would create the most extensive federal framework for prediction markets so far if adopted. Its analysis said the proposal would review contracts case by case rather than ban complete categories in advance. It would also distinguish games from contests, placing elections and award events outside the proposed gaming definition. Prediction-market growth raises filing pressure The CFTC’s March rulemaking notice showed how quickly the market had changed. Registered exchanges listed an average of about five event contracts each year from 2006 through 2020. That figure rose to 131 in 2021 and reached about 1,600 new contracts during 2025. The contracts covered economics, weather, politics, science, culture, sport and international events. More recent testimony cited by crypto.news placed 2025 trading volume across CFTC-registered prediction markets above $25 billion. It also said daily listings on one large platform rose from about 1,600 in April 2025 to roughly 162,000 in April 2026. That pace makes complete contract submissions more important because small changes in settlement terms can create different legal and market risks. As crypto.news previously reported, the CFTC’s proposed public-interest rules could affect platforms such as Kalshi and Polymarket. The agency may examine sports products and markets tied to war, terrorism or political violence more closely. Meanwhile, related coverage said Robinhood was discussing adding Crypto.com contracts as it builds a broader prediction-market network. The talks came as platforms added more event-contract suppliers and federal and state regulators continued to dispute who controls sports-linked products. The July advisory does not identify any platform or announce an enforcement case. It acts as a compliance notice to all designated contract markets using self-certification. Exchanges can continue listing qualifying products, but each filing must give CFTC staff enough information to judge contract terms, settlement design, data quality and adherence to market rules. US Crypto Regulations — Read the full US Regulation Hub for the latest on SEC enforcement, IRS crypto tax rules, and pending legislation.
