CFTC gives prediction markets leeway on data and record-keeping rules

The Commodity Futures Trading Commission has issued “no-action” letters to a group of prediction markets, exempting them from requirements related to swap data reporting and record-keeping regulations.

The CFTC’s Division of Market Oversight and the Division of Clearing and Risk won’t initiate enforcement action against several prediction market platforms for shirking certain recordkeeping demands, provided they follow other specific requirements, the agencies said in a statement on Thursday.

“The no-action letters apply only in narrow circumstances and are comparable to no-action letters issued for other similarly situated designated contract markets and derivatives clearing organizations,” they added.

The companies that received a no-action letter are Polymarket US, LedgerX, PredictIt and crypto exchange Gemini’s prediction markets arm, Gemini Titan.

As part of the requirements to avoid enforcement, the platforms must fully collateralize all their contracts by ensuring its completely covered by assets held in reserve, and also publish time and sales data for all event contract transactions on their websites “after execution of the transactions,” according to the letters.

Prediction markets and event contracts enable traders to take positions on the outcome of various events, including sports and unconventional topics such as the clothing choices of political figures.

These contracts trigger extensive reporting and record-keeping obligations in the US as prediction markets are regulated as designated contract markets; however, the no-action letter now frees them from the threat of immediate enforcement risk if those obligations aren’t kept.

Related: Gemini soars 14% as new license opens door to US prediction markets

A no‑action letter means the CFTC staff won’t recommend enforcement if the requesting party fails to comply with certain regulations under very specific terms; however, it doesn’t change the law, and they are generally used to temporarily reduce regulatory risk while the market or product evolves.

Prediction markets record bumper 2025 

Prediction markets have become one of the most popular crypto offerings this year, with trading volumes on platforms such as Kalshi and Polymarket regularly recording billions of transactions.