The Commodity Futures Trading Commission (“CFTC”) recently issued an order disapproving the listing of a political event contract self-certified by a designated contract market. This recent CFTC disapproval comes just after the Fifth Circuit Court of Appeals issued a related and important opinion regarding the operation of a political event contract market pursuant to longstanding CFTC no-action relief.
This alert summarizes these two recent developments and their potential implications for future event contract markets, as well as the scope of the CFTC’s anti-fraud and anti-manipulation authority (which comes up frequently in the digital asset spot market context). We also analyze the potential impact for the CFTC’s practices with respect to staff no-action letters after the Fifth Circuit decision.
