CFTC gives US exchanges 30 days to end state-by-state blocks
Why it matters
Prediction markets on sports and elections are caught between a federal regulator and state courts. Any broker or fintech offering these contracts may now face conflicting orders from Washington and from judges.
Post to XThe short version
On 5 November the US Commodity Futures Trading Commission, which oversees futures markets, told the trading venues it supervises that blocking customers in particular states breaks federal rules. They have 30 days to restore nationwide access or explain why they can't. Several courts have ordered firms such as Kalshi to do exactly that blocking.
Here's what happened. On 5 November the CFTC published its reading of the "impartial access" rule, which says regulated exchanges must treat all customers fairly. Its view: cutting off users by US state breaks that rule.
Exchanges have 30 days to stop such limits or explain to the CFTC's market oversight division why they can't, the agency said. They must also check that brokers connecting customers to their markets aren't getting in the way. Chairman Michael Selig said derivatives markets should work the same across the whole country.
Why now? Prediction markets, where people trade contracts on events like sports and elections, are fighting states in court. CoinDesk named Kalshi and Polymarket among the exchanges affected. It reported that Kalshi had been geofenced, meaning blocked by location, in Nevada, Washington and Michigan. A California judge has also ordered access blocked in certain tribal areas.
So the CFTC is telling firms to do the opposite of what some judges have ordered. Senator Adam Schiff said on X that the agency appears to be encouraging firms to keep offering bets in contempt of court orders, according to CoinDesk.
One more detail: the commission normally has five members but currently has one, Selig, CoinDesk noted.
Where this comes from
Written with AI from the sources above and checked against them before publishing. Here's how we work. This is news, not financial advice. Spotted a mistake? Tell us.