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The Commodity Futures Trading Commission says prediction markets must remove domestic geographic restrictions that violate its impartial access requirements within 30 days or explain why compliance is not feasible, according to InGame.
The interpretation could affect Kalshi and sports event contract offerings from DraftKings, FanDuel and Fanatics. No West Virginia-specific access change was reported.
CFTC extends impartial access interpretation to state restrictions
The CFTC’s interpretation concerns its second core principle, which addresses impartial access. Previously, the agency had not interpreted that principle to require geographic access across the United States.
Designated contract markets, or DCMs, must stop domestic geographic restrictions that violate those requirements or submit an explanation to the CFTC’s Division of Market Oversight. The interpretation also applies to intermediaries, including futures commission merchants and introducing brokers that give customers access to other exchanges.
“Geographic access restrictions are inconsistent with those purposes and the Act’s impartial access requirements,” CFTC Chairman Michael Selig said, referring to the Commodity Exchange Act’s purposes.
The agency said restricting access can reduce liquidity and undermine an exchange’s ability to serve as a marketplace for trading and risk management. It highlighted sports contracts, where excluding regions with strong interest in a particular team could reduce overall liquidity.
Court orders and sportsbook licenses complicate compliance
The federal interpretation creates tension with restrictions stemming from state legal and regulatory action.
According to InGame, court orders have banned Kalshi’s sports contracts in Michigan, Nevada and Washington. Kalshi also withdrew those contracts from Utah after the state brought criminal charges.
DraftKings, Fanatics and FanDuel restrict access to sports event contracts in some states because gaming commissions have threatened to revoke the sportsbook licenses of operators offering those contracts.
Under the CFTC interpretation, companies unable to comply with the access requirement must explain why compliance is not feasible to the Division of Market Oversight within the 30-day window.
If you gamble, set limits and only wager what you can afford to lose.
More from playwv.com – CFTC Rules Draw a Line Between Sports Contracts and Sportsbook Bets – Prediction market firms push back on CFTC affiliate trading proposal – CFTC settlement bars former White House worker from prediction markets after Kalshi profits
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Source: As reported by InGame.
