CFTC Investigates Crypto.com and Kalshi Over Super Bowl Event Contracts

The CFTC is investigating whether sports event contracts on Crypto.com and Kalshi are classified as "gaming" under the Commodities Exchange Act. Key points include:

Crypto lawyer Aaron Brogan states that if sports do not qualify as gaming, the CFTC may lack authority to prohibit self-certification of these contracts.
The issue is complex; a previous ruling allowed Kalshi's election betting contracts, indicating they do not fall under CFTC restrictions.
Brogan highlights that the definition of "gaming" has legal nuances, referencing legislative history meant to cover sports betting.
Merriam-Webster defines gaming as gambling, suggesting prediction markets could argue against classification as gaming.
The CFTC's regulatory approach may shift under Republican Chair Caroline Pham, though skepticism towards retail-oriented event contracts remains.
Current probes into Kalshi contracts may indicate continued scrutiny from the CFTC.