of Commodity Futures Trading Commission The CFTC just announced a proposal to restrict trading in event contracts with political consequences. After a three-and-a-half hour meeting Friday, three commissioners voted in favor of the proposed rulemaking. In the future, the public will also be able to comment on these plans. CFTC Chairman Rostin Benham Commodifying the democratic process was thought to be the purpose of political event contracts. The scope of the latter could therefore extend beyond the CFTC's mandate, turning the commission into an election monitoring agency.
CFTC proposes ban on politically tied contracts
However, in addition to political leanings, the prescribed ruling also prohibits agreements that finance situations such as games, wars, terrorism, assassinations, etc., and the creation of these sanctions is aimed at national interests. It is not aimed at the national interest at all. Regarding this, Behnum said that starting in 2021, the number of event contracts has increased significantly compared to the past 15 years. This alone has more contracts listed in his 2021 year than from 2007 until 2021. This phenomenon has been observed repeatedly, highlighting the incredible speed of market expansion.
Despite overwhelming support for the proposal, CFTC Commissioner Caroline Pham criticized the move as misguided. fam argued He pointed out that the rule-making process deviates from the Administrative Procedure Act and the principles of the Constitution. It expressed concern about the Commission's deviation from its core responsibilities and apparent disregard for fairness and due process. This internal dissent signals a deepening debate within the CFTC about the balance between regulation and market freedom.
Behnam predicts tighter regulation of virtual currency market
On the other hand, Kalshi and PolymarketServices that allow users to speculate about various future events are facing increasing scrutiny. The CFTC has in the past rejected Mr. Carsi's contracts that facilitated betting on political outcomes, but Mr. Carsi has challenged the decision as overstepping his authority. The company, which is backed by investment firm Paradigm, has spoken out against what it sees as restrictive measures that stifle market innovation.
Although the crypto sector is receiving increased regulatory attention, Behnam says the sector has not yet felt enough regulatory pressure.of CFTC Chairman He predicted that there would be a wave of new enforcement actions targeting the cryptocurrency market within the next 6 to 24 months. This points to growing concerns about the intersection of cryptocurrencies and prediction markets, particularly how they are used and regulated.
The focus on stricter regulation reflects a broader trend for regulatory bodies to increase their oversight of financial markets, particularly those related to innovative and rapidly evolving technologies.
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