CFTC Uses Emergency Powers to Support Kalshi

August 11 The Commodity Futures Trading Commission (CFTC, a regulatory agency in the U.S.) invoked emergency powers for only the seventh time in its history. The action was spurred by the need to support the Kalshi platform, which came under pressure after the state of New York filed a $36 billion lawsuit against it, accusing it of illegal gambling through predictive contracts.

Background: The Law and Predictive Contracts

Predictive contracts are agreements that allow participants to wager on the outcomes of various events. Sometimes these instruments spark controversy due to overlaps with gambling laws…

CFTC and Its Powers

CFTC is responsible for regulating futures and derivatives markets in the U.S. The organization’s emergency powers enable quick intervention in situations that could cause significant market harm or affect participants’ interests.

Legal Conflict: Federal vs. State Laws

Differences exist between federal regulation and the laws of individual states. This creates legal friction around platforms like Kalshi. CFTC, while protecting the markets, offers alternative solutions to the problem. Such conflicts could lead to changes in legislation.

Impact on the Market and Users

CFTC’s measures could allow Kalshi to continue operations without interruption. This is crucial for market participants who rely on access to predictive contracts for hedging and other strategies.

Conclusion: Significance for the Industry

Through its actions, CFTC demonstrates support for innovation in the derivatives market but also emphasizes the need for compliance with regulatory standards.

• Opportunity: Development of the predictive contracts market.
• Threat: Legal claims could set a precedent for other states.

Follow new insights in our telegram channel.

No need to invent complex schemes and look for the "grail". Use the Resonance platform tools.

Register via the link — get a bonus and start earning:
OKX | BingX | KuCoin.

Promo code TOPBLOG gives you a 10% discount on any Resonance tariff plan.