The U.S. Commodity Futures Trading Commission, or CFTC, has submitted two rules to the White House Office of Management and Budget (OMB) for review, according to ChainCatcher.
One proposal would place event contracts within the regulatory definition of swaps. The other, labeled an interim final rule, would exclude "casino-style gambling products" from what counts as a swap. OMB received both items this week, and the documents are dated Sept. 28.
OMB review is now underway
OMB review is usually the last step before a rule goes out for public comment. An interim final rule works differently: it takes effect right away while still leaving room for later comments and revisions.
Fight over prediction markets remains active
The filing lands as the CFTC and multiple states continue to contest the legal nature of prediction markets. Event contracts are generally binary yes-or-no wagers on measurable outcomes, including sports contests and elections.
Last week, the U.S. Court of Appeals for the Sixth Circuit held that Kalshi's sports-related contracts are not swaps and should fall under state gambling law. The Eighth Circuit issued a similar ruling.
The Third Circuit had previously found that the CFTC has jurisdiction over prediction markets, creating a split across the federal courts.
What the rules could mean for state cases
CFTC Chair Mike Selig has argued that the agency has exclusive jurisdiction over prediction markets. If event contracts are treated as swaps and are not classified as gambling products, states could see their position weakened in several lawsuits against prediction market platforms such as Kalshi.
Commission structure and crypto rulemaking
Under the law, the CFTC is supposed to have five commissioners. President Trump has not nominated additional commissioners so far, leaving Selig as the only current member and in a position to advance regulatory and policy decisions on his own.
OMB disclosures also show that the CFTC recently submitted a preregulatory item to the White House focused on crypto regulation.