CFTC Division of Market Oversight Issues Prediction Markets Staff Advisory, March 2026

On March 12, 2026, the CFTC's Division of Market Oversight (DMO) issued a staff advisory addressed to Designated Contract Markets (DCMs) regarding the listing and trading of event contracts on prediction markets. The advisory is a guidance document, not a rulemaking, and does not amend existing CFTC regulations. It takes effect upon issuance and is currently operative. This action accompanied a parallel Advance Notice of Proposed Rulemaking (ANPRM) issued the same day (CFTC Press Release 9194-26).

The advisory directs DCMs to their existing obligations under the Commodity Exchange Act, specifically CEA Section 5(d) and 17 CFR Part 38, DCM Core Principle 3 and the guidance in Appendix C to Part 38, and product submission requirements under Part 40. Core Principle 3 requires a DCM to list only contracts that are not readily susceptible to manipulation. The advisory also addresses specific considerations relevant to sports-related event contracts, including the potential for manipulation and the public interest assessment that DCMs must conduct before listing such contracts.

DCMs that currently list or intend to list prediction market event contracts must treat this advisory as a formal signal from the DMO to review their compliance posture under CEA Section 5(d) and Part 38. DCMs should assess whether their listing procedures for event contracts satisfy Core Principle 3 and Appendix C requirements. The advisory expressly calls on DCMs to take proactive steps as "front-line regulators" to ensure their markets evolve in compliance with the CEA and Commission regulations. Non-DCM operators of prediction market platforms should note that the advisory reinforces the CFTC's position that event contracts fall within its exclusive jurisdiction.

The advisory does not alter the legal standard for listing event contracts or create new obligations beyond those already in CEA Section 5(d) and Part 38. The concurrent ANPRM (91 FR 12516) may eventually result in new or amended rules that would supersede portions of this advisory's guidance. DCMs and their compliance teams should monitor ANPRM developments and submit comments by the April 30, 2026 deadline to influence any forthcoming regulatory changes.

Source: CFTC Division of Market Oversight Staff Advisory, "Prediction Markets Advisory" (Mar. 12, 2026); CFTC Press Release No. 9193-26. Available at: https://www.cftc.gov/PressRoom/PressReleases/9193-26. Confirmed: March 16, 2026.

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