CFTC streamlines swap reporting for 19 prediction markets

The Commodity Futures Trading Commission on Thursday issued a no-action letter that simplifies swap data reporting and recordkeeping for event contracts on prediction markets. The relief lets 19 named platforms, among them Polymarket US and Kalshi, use reporting formats designed for futures instead of the more detailed swap templates.

The guidance was issued jointly by the CFTC’s Division of Market Oversight and Division of Clearing and Risk. It covers firms that previously received similar relief and establishes a single process for new entrants. Operators may request identical treatment and, if approved by the divisions, be added to the letter’s appendix rather than pursuing separate approvals.

The letter explains that event contracts meet the legal definition of swaps but function like futures because of “highly-standardized terms, exchange-trading protocols, fungibility, and offset.” Because the contracts trade on designated contract markets rather than swap execution facilities, the agency allowed futures-style reporting to align the data format with how the products trade.

The 19 beneficiaries named on the appendix include a mix of crypto-native platforms and traditional derivatives exchanges expanding into event contracts; examples listed in the letter are Polymarket US, Kalshi, Gemini Titan and Bitnomial. The agency said it issued the coordinated guidance after receiving multiple requests from exchanges seeking clarity on how to comply with swap data reporting and recordkeeping rules for these products.

The letter does not change the statutory classification of event contracts as swaps. It provides limited enforcement relief limited to reporting and recordkeeping requirements. Firms that want to be added to the appendix must submit requests to the two divisions for approval.

The action comes as the CFTC and several states dispute which authorities should regulate prediction markets. CFTC Chair Michael Selig has argued that state regulation could push markets offshore and raise risks to market integrity. At a recent House Agriculture Committee hearing, lawmakers questioned Selig about suspicious trading patterns and wagers tied to geopolitical events.