The Commodity Futures Trading Commission’s Division of Market Oversight issued an advisory outlining expectations for designated contract markets that self-certify market-maker, liquidity, trading or other incentive programs, with a focus on prediction markets offering event contracts. The advisory responds to an increase in procedurally or substantively deficient filings and clarifies existing requirements rather than creating new obligations. Filings must disclose all material economic, structural and operational terms and assess compliance with core principles covering market integrity, impartial access, conflicts of interest and competition. Material amendments, renewals and extensions require a new filing, while substantive changes during review require withdrawal and resubmission, restarting the 10-business-day review period. The guidance warns against structures that may encourage abusive trading or unequal access, including steep volume thresholds, guaranteed profits, unlimited or disproportionate payouts, undisclosed preferential benefits and chance-based rewards, and calls for program-specific surveillance and controls. The division recommended that designated contract markets review previously submitted incentive programs and file applicable amendments or notices of nonsubstantive revisions by September 14, 2026.
Commodity Futures Trading Commission2026-08-12
Commodity Futures Trading Commission issues advisory after identifying deficiencies in prediction market incentive program filings
The Commodity Futures Trading Commission issued guidance after identifying recurring deficiencies in self-certifications for prediction market incentive programs. Designated contract markets must fully disclose program terms, submit material changes as new filings and address risks involving abusive trading, unequal access, conflicts and competition. The regulator recommended reviewing existing programs and filing applicable revisions by September 14, 2026.