CFTC warns prediction markets over gambling-style odds

The CFTC has warned regulated prediction markets against displaying American-style gambling odds as state authorities intensify efforts to classify sports event contracts as unlicensed betting. Summary The CFTC told regulated prediction markets to avoid American-style odds in product displays. Platforms must comply with derivatives laws and avoid deceptive marketing or solicitation practices. New York is seeking at least $36 billion from Kalshi over alleged gambling violations. Kalshi has requested emergency protection from Utah enforcement while it pursues an appeal. CFTC warns prediction markets over odds displays The Commodity Futures Trading Commission instructed regulated prediction market platforms not to display contracts using American-style gambling odds, according to an Aug. 7 Bloomberg report. American odds typically show potential returns using positive and negative numbers, such as +150 or -200. Sportsbooks commonly use this format, while prediction markets usually price contracts between $0 and $1 based on the implied probability of an event. The CFTC also reminded registered entities that event contracts remain subject to U.S. derivatives laws. Platforms must avoid “...