Blockchain Association Backs CFTC Push for Prediction Market Rulemaking

The Digital Chamber ("TDC"), a blockchain and digital asset trade association, urged CFTC Chair Michael Selig to pursue formal rulemaking for prediction markets and event contracts.

In a letter to Chair Selig, TDC contended that the current regulatory ambiguity surrounding event-based derivatives "has led to inconsistent interpretations and recurring disputes." The association argued that clear, tailored rules would establish a coherent framework for classification, listing standards, and settlement procedures, ultimately eliminating the "regulatory patchwork which the CEA’s exclusivity provisions were designed to prevent."

TDC emphasized the critical need to affirm the CFTC's exclusive regulatory jurisdiction over these markets. According to the association, "fragmented state [gambling] enforcement ... undermines liquidity, impairs price discovery, and creates inconsistent obligations for market operators." By articulating expectations through a formal rule rather than relying on enforcement alone, TDC argued, the Commission would provide courts and participants with a clear interpretation of congressional intent, ensuring that derivatives markets "remain subject to consistent national oversight."

TDC also highlighted the importance of implementing tailored consumer protections, recommending clear disclosure requirements and transparent dispute resolution policies. Without such regulatory clarity, the association argued, "innovation [could] migrate offshore or into less transparent venues." Although noting that prediction market operators have historically taken conservative approaches to avoid friction, TDC urged the Commission to adopt specific rules that protect retail participants "without importing gaming-style restrictions that are misaligned with federal derivatives regulation."