Prediction market battle! The Crypto.com Super Bowl prediction market is about to kick off, with the US CFTC's involvement sparking controversy.

The Commodity Futures Trading Commission (CFTC) is considering whether to review the popular exchange Crypto.com's Super Bowl prediction contract. Although this novel combination of on-chain prediction contracts and sports events trading has sparked a lot of legal controversies.

CFTC reviews the legality of SUPER Bowl contract trading, with a review period longer than the game day

According to Bloomberg, Crypto.com submitted documents to the CFTC on 12/19 last year, planning to launch prediction contracts related to American football, covering multiple events including the Super Bowl, and officially open the contract market for trading two days before Christmas last year. However, due to factors such as national holidays, government agencies, and public officials on leave, the CFTC was unable to complete the review in time.

Currently, there are five commissioners in the CFTC who are voting on whether to conduct a 90-day legal review of these contracts. The review results will be announced after the Super Bowl on 2/9, but after the review, similar contract trading may be prohibited.

The contract design and legal boundaries are blurred, is sports gambling a legal transaction

The CFTC has always been cautious about contract trading related to sports, war, or assassination events. Crypto.com's contracts do not directly mention the names of the matches, but use terms such as 'championship' and 'home celebration events' to describe them. The main concern is that these trades may raise legal or ethical concerns.

The contract trading amount is designed to start at $100, with individuals able to hold contracts worth up to $250,000, while bankers can hold contracts worth up to $25 million. Crypto.com said that this move aims to increase market transparency and cites previous legal rulings as legal support for such event contracts.

Cryptocurrency vs sports betting, competition heats up

The addition of Crypto.com has intensified competition in the sports betting market, not only covering the entire United States in terms of trading methods, but also not being restricted by state regulations like traditional gambling operators. In addition, Crypto.com does not set odds, only acts as an intermediary and provides a trading market, with the platform only charging a small handling fee.

Currently, 30 states and the District of Columbia in the United States allow mobile sports betting, but unregulated online gambling platforms like Polymarket also provide similar prediction functions, further expanding the market enthusiasm.

New regulations are imminent, the Trump administration may adopt a more lenient policy

CFTC Chairman Behnam stated that the regulation of event contracts is still in a gray area and urgently needs to clarify which behaviors are legal and which behaviors are not allowed. He mentioned, 'The current development has deviated from the essence of derivative financial instruments, and we need clearer regulations.'

The outgoing Behnam has not yet completed the regulatory regulations defining 'games' in event contracts by 2024. The next chairperson of the CFTC is expected to adopt a more friendly attitude towards such markets under the Trump administration.

(The final remarks of the CFTC Chairman: Highlighting the lack of regulatory framework for cryptographic derivative financial products)

This article predicts the market battle! Crypto.com Super Bowl predicts the market is about to start, the US CFTC intervenes in the review and sparks controversy. It first appeared in Chain News ABMedia.