CFTC cautions prediction markets over using American-style 'moneyline' betting odds: Bloomberg

Some prediction market platforms received a warning from the Commodity Futures Trading Commission to abstain from using American-style gambling odds, according to Bloomberg, as the agency seeks to assert its jurisdiction over sports betting. 

The CFTC sent letters to its regulated entities and told them to comply with the law and to not use "deceptive" practices when listing, advertising or soliciting, Bloomberg reported on Friday, citing a letter they obtained. 

American-style gambling odds, also known as moneyline odds, show how much you win on a $100 bet with a plus or minus sign. Prediction markets instead show prices in cents that directly equal the implied probability, and these convert to American odds via simple formulas — under 50¢ becomes positive odds, over 50¢ becomes negative. 

The CFTC cited a study in its letter that found American-style wagers led to more risk-taking when it comes to sports betting, according to Bloomberg. 

A spokesperson for Kalshi said the platform follows the agency's guidance. 

"As a federally regulated exchange, Kalshi follows CFTC guidance and will comply with the letter by its deadline," the spokesperson said in an emailed statement. 

Polymarket and the CFTC did not respond to requests for comment. 

Over the past year, CFTC Chair Michael Selig has maintained that the agency has exclusive jurisdiction over the rapidly expanding prediction markets, even suing several states to defend that position.

He has also launched a rulemaking effort and argued that the CFTC's statutory authority is broad enough to oversee the industry, despite objections from states that contend prediction platforms are violating local gaming and gambling laws, particularly those governing sports betting.

At the same time, prediction market platforms such as Polymarket and Kalshi have surged in popularity, reaching multibillion-dollar valuations. Both companies have advocated for CFTC oversight of their businesses.

More recently, senators and tribal gaming regulators have begun pushing for legislative language that would preserve states' authority over sports betting and prevent prediction markets from encroaching on that jurisdiction.