WASHINGTON, D.C. — Cantrell Dumas, Director of Derivatives Policy at Better Markets, issued the following statement regarding the release of a new fact sheet titled “Stop the Spread: Why the CFTC Must Shut the Door on Gambling in Derivatives Markets”:
“Congress made it clear that contracts involving gambling, like betting on sports, do not belong in federally regulated derivatives markets. But instead of enforcing that statutory firewall, the CFTC continues to sit on its hands while sports betting-style contracts spread across exchanges it oversees.
“Even more troubling is how Kalshi, one of the federally regulated exchanges involved, has completely reversed its position. In its court case filed against the CFTC, Kalshi openly admitted that sports event contracts fall under the ‘gaming’ category that Congress intended to prohibit. The company even argued that such contracts have no economic value and should not be listed on an exchange. Yet now, with little fear of regulatory pushback, Kalshi is marketing those same types of contracts as legal in all 50 states. What changed? Not the law. It’s just the CFTC’s unwillingness to enforce it.
“For months, the CFTC said it needed time to study the issue and pointed to its planned roundtable as part of that process. That seemed to be the reason it was holding off on stopping any sports betting-style contracts. But now the roundtable has been quietly canceled, and the CFTC still hasn’t lifted a finger. It’s starting to look like the roundtable was just a ‘head fake’ to cover up the fact that the CFTC has no intention of stopping these contracts.
“The CFTC still has time to regroup and shut down the spread of gambling contracts before it sidelines its core mission. Because if this trend continues, the CFTC won’t be protecting farmers, energy producers, or the broader economy. It will be too busy refereeing bets on football games.”
The Fact Sheet is available here.
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Better Markets is a non-profit, non-partisan, and independent organization founded to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies—including many in finance—to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.org.
