CFTC Proposes Swap Rules for Prediction-Market Event Contracts
On October 9, 2026, the CFTC published Release No. 9310-26 titled "CFTC Seeks Public Comment on Notice of Proposed Rulemaking Concerning the Inclusion of Certain Event Contracts in the Definition of Swap" CFTC. The release opened a public comment period on a plan to count certain event contracts as swaps.
A swap is a contract where one side pays the other based on whether something happens or how a price moves. An event contract pays out based on the outcome of a stated event. The proposal would write event contracts directly into the swap definition. The CFTC says event contracts are typically structured as swaps CFTC. It would define "prediction market" as a designated contract market or swap execution facility — federally registered exchanges and trading platforms — that offers event contracts in swap form. Only those registered venues offering that swap-form product would fit the definition.
On the same day, the CFTC published Release No. 9309-26 titled "CFTC Issues Interim Final Rule Excluding Certain Activity from the Definition of Swap" CFTC. One release uses full notice-and-comment rulemaking to propose inclusion. The other uses an interim final rule to set an exclusion. Both act on the edge of the swap definition through different procedures.
Earlier steps came first. In March, the CFTC published an Advanced Notice of Proposed Rulemaking on prediction markets. On June 10, 2026, Reuters reported the CFTC had released draft rules for the prediction markets industry Reuters. A June 24 analysis from the Congressional Research Service said the 2026 proposed rule would amend Rule 40.11 to codify a contract-specific check for whether event contracts are covered CRS. Under that description, staff would review individual contracts rather than judge the whole category at once. The same analysis said the CFTC proposed to define "gaming" to include event contracts based on political elections. Rule 40.11 has served as the gate for categories that cannot be listed. Writing the contract-by-contract test into it would set how staff and the Commission review individual filings.
CFTC educational materials say prediction markets offer products to help the public forecast, plan for, hedge, and use views about future events. Event contracts, in that description, can hedge economic risk or speculate on prices and outcomes.
The broader context here is about boundaries, not approval of any single contract. If certain event contracts traded on registered venues count as swaps, they fall under federal swap rules. That brings reporting, clearing where it applies, business-conduct, and market-integrity duties that do not apply the same way off those venues. For lawyers and compliance teams, the test will be which contracts meet the inclusion wording and which sit inside the interim exclusion.
Looking at what this means for market structure, firms will have to check each contract against both tracks. Does the payout refer to an event in the proposed inclusion language. Does the activity fall in the interim exclusion. Is the venue a designated contract market or swap execution facility offering the contract in swap form. Public comments will shape the final wording. The inclusion language, the scope of the exclusion, and how Rule 40.11 review works will decide what can be listed and how far supervision reaches.
