U.S. CFTC Proposes Rule Amendments and New Appendix F to Clarify Prohibited or Restricted Areas—Including Prediction Markets That Violate the Public Interest

The U.S. Commodity Futures Trading Commission (CFTC) issued a notice proposing amendments to CFTC Rule 40.11 and the addition of Appendix F, and formally soliciting public comment to establish a structured assessment framework for event contracts. It is reported that the number and variety of event contracts listed by registered trading entities continue to grow—including contracts tied to sporting events—with the aim of evaluating whether such contracts involve activities enumerated in the Commodity Exchange Act (e.g., terrorism, assassination, war, gambling, or acts violating federal or state law) and determining whether they contravene the public interest. This notice of proposed rulemaking forms part of the CFTC’s Advanced Notice of Proposed Rulemaking (ANPRM) on prediction markets, released last March, and establishes a 90-day public review period while clarifying key legal terms such as “involves” and “gambling.”