ASIC’s proposal would extend leverage limits and protections against negative balances to certain derivatives settled in digital assets.
CFTC aims to differentiate swaps from gambling
The Commodity Futures Trading Commission (CFTC) has issued two proposals, one that would define event contracts as “swaps” under federal law and another that excludes traditional casino gambling from that definition.
Several states have sued prediction-market operators, including Kalshi and Polymarket, alleging illegal gambling, and the CFTC has countersued to defend its federal jurisdiction over event contracts, which it claims are beyond the purview of state regulators.
The first proposal clarifies the definition of “swap” to include event contracts, including those tied to sports, politics, cultural events and weather.
It notes these contracts are financial instruments that are commonly known to the trade as swaps and proposes to resolve any ambiguity regarding them.
“These products are commodity derivatives squarely within the CFTC’s regulatory remit under the Commodity Exchange Act and are within the agency’s exclusive jurisdiction,” Chairman Michael Selig said.
Both measures have 30-day comment windows
The second proposal codifies the CFTC’s view that casino-style gambling products, including wagers placed on sportsbooks and casino games, are excluded from the “swap” definition.
“Casino-style gambling products are not derivatives,” Selig said, “Just as the CFTC has done with respect to other products historically regulated by the states, the Commission today provides clarity regarding the limits of its regulatory remit by codifying the exclusion of casino-style gambling products from the ‘swap’ definition.”
Both measures, filed on Friday, carry 30-day comment windows.
The two measures help set the stage for a potential Supreme Court battle over federal and state jurisdiction.
Related: NFL backs New Jersey authorities in SCOTUS petition over Kalshi
Cointelegraph reported in late September that prediction market Kalshi lost on appeal when a court ruled that Ohio and Tennessee can regulate sports-event contracts under their state gambling laws.
The 6th US Circuit Court of Appeals ruled against Kalshi when a three-judge panel sided unanimously with Ohio and Tennessee, finding that the prediction market failed to demonstrate its sports-event contracts are “swaps” under the jurisdiction of the CFTC.
Still, an April decision by the 3rd Circuit Court of Appeals allowed Kalshi to do business in New Jersey as its appeal process proceeds.
The April ruling said Kalshi was likely to succeed with its argument that federal law preempts New Jersey’s regulations, all of which has set up the potential Supreme Court case.
Cointelegraph also reported that a group of state lawmakers had filed an amicus brief with the Supreme Court, urging it to weigh in on the case between Kalshi and state gaming authorities, potentially resolving whether state authorities or federal agencies have jurisdiction over prediction market companies.
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Blockchain.com Applied for CFTC Licenses for Prediction Markets, Derivatives: Report
Blockchain.com has reportedly applied to the US Commodity Futures Trading Commission (CFTC) for approval of prediction market offerings and crypto derivatives.
CNBC reported Friday that the exchange filed for two licenses with the CFTC for event contracts and crypto derivatives offerings for US-based retail and institutional investors. The licenses, as a designated contract market (DCM) and futures commission merchant (FCM), would allow Blockchain.com to operate as a futures exchange for event contracts and a broker for derivatives contracts, respectively.
Blockchain.com announced in July that it planned to partner with Polymarket as part of a prediction markets integration on the company’s app. However, if approved, the CFTC license would allow the exchange to offer its own marketplace with event contracts.
The question of oversight and enforcement of prediction market platforms like Kalshi and Polymarket is currently being tested in US courts, as many state-level authorities have lawsuits pending against companies for alleged violations of laws betting on sports and elections. Last month, New Jersey officials filed a petition with the US Supreme Court to weigh in on their case against Kalshi, which could resolve disputes between federal and state regulators.
Related: Prediction markets hit new high as Polymarket enters Sam Altman’s World
Blockchain.com was also reportedly considering an initial public offering with a valuation of up to $6 billion, expecting to raise $500 million.
CFTC chair pushes crypto regulation, citing FTX collapse
This week, CFTC Chair Michael Selig justified the agency’s attempts to move forward with cryptocurrency regulation through rulemaking rather than legislation passed by Congress, invoking the downfall of the FTX exchange. The crypto company filed for bankruptcy in November 2022 and led to criminal charges for many of its executives, including former CEO Sam Bankman-Fried.
In a Wednesday Fox Business interview, Selig said the proposed rules, which would affect companies registering as licensed crypto businesses, would bring “safeguards to crypto spot markets,” citing FTX’s collapse. On Friday, he posted that the agency’s rules would prevent “theft of customer funds as we saw with FTX.”
Selig remains the CFTC’s sole commissioner and chair, with no nominations for the four empty seats at the agency announced by the White House as of Friday. The chair has repeatedly said he plans to enact President Donald Trump’s crypto agenda and has also claimed the agency has exclusive jurisdiction over prediction markets.
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France Proposes Stablecoin Swap Tax and Crypto Exit Tax
France’s National Assembly Finance Committee approved proposals this week to tax swaps into fiat-pegged stablecoins and extend the country’s exit tax to crypto investors.
Amendment I-CF1826, submitted by French MP Nicolas Sansu and adopted Wednesday, would make crypto conversions into fiat-pegged stablecoins taxable events from Jan. 1, 2027.
The explanatory text describes the current tax treatment as a “loophole in the legislation,” according to a machine translation.
Taxable gains would be calculated using the acquisition cost of the assets disposed of, with a weighted average for holdings of the same token bought at different prices.
The full Assembly is scheduled to begin examining the 2027 Finance Bill on Tuesday, Oct. 13. If enacted, investors could incur capital gains taxes without cashing out into fiat.
MP Daniel Labaronne’s Amendment I-CCF798, also adopted Wednesday, would allow investors to carry forward realized crypto losses for 10 years. An exit tax amendment adopted Thursday would cover unrealized gains when taxpayers with household crypto holdings worth more than 800,000 euros ($895,000) transfer their residences abroad.
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European crypto tax proposals take different approaches
On Wednesday, Greece’s Ministry of National Economy and Finance published a draft bill proposing a 10% tax on individuals’ crypto capital gains, with an exemption for annual gains of up to 500 euros ($560).
Unlike France’s proposed tax on conversions, the Greek proposal would leave crypto-to-crypto exchanges untaxed.
France and other European Union members must apply the bloc’s tax reporting rules under the eighth amendment to the Directive on Administrative Cooperation (DAC8).
DAC8 requires crypto service providers to collect users’ identities and transaction data and report them to national tax authorities, which then exchange the information with their counterparts across EU member states. The crypto reporting requirements began applying on Jan. 1, 2026. The first exchanges of information covering 2026 transactions are due by Sept. 2027.
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ESMA Explores Tokenized Collateral for EU Clearinghouses
The European Securities and Markets Authority (ESMA) wants evidence that clearinghouses can access tokenized collateral and turn it into cash if markets come under stress.
ESMA published a call for evidence Friday to seek industry feedback on the implications of tokenized collateral.
“We must create the conditions for tokenized markets to operate safely and at scale across borders, with legal certainty, interoperable infrastructures and appropriate supervision,” ESMA Chair Verena Ross said.
Tokenized collateral is entering live European clearing operations as banks and investors seek faster access to securities to meet margin requirements. ESMA’s review will help determine whether existing EU rules can ensure clearinghouses can access and liquidate such collateral when a member defaults.
In July 2025, Eurex Clearing introduced a collateral service based on distributed ledger technology. JPMorgan executed the first live transaction for Dutch pension investor PGGM, moving securities from another custody location.
Tokenized collateral faces liquidity and ownership scrutiny
The consultation covers tokenized representations of assets held in traditional financial infrastructure and assets issued directly on distributed ledgers. It also examines how those models interact with stablecoins, central bank money and tokenized deposits.
ESMA said even assets that are liquid in traditional form may face additional risks when tokenized, including delays caused by redemption procedures or restrictions on transfers.
It also asked whether token transfers confer ownership or enforceable rights over the underlying assets.
Related: ESMA to prioritize EU-wide AI and tokenization supervision in 2027
The consultation follows the Eurosystem’s September launch of Pontes, a system allowing financial institutions to settle tokenized asset transactions using central bank money. ESMA said Pontes could support tokenized collateral arrangements by connecting blockchain-based infrastructure with existing settlement systems.
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UK Sanctions Three Crypto Exchanges Tied to Russian Illicit Funds
The UK government has sanctioned three cryptocurrency exchanges and two payment platforms suspected of helping Russian entities circumvent financial sanctions.
Three of the service providers were linked to Kyrgyzstan, while two of them facilitated transactions with the Kremlin-backed A7 network, the UK Foreign, Commonwealth & Development Office (FCDO) announced Thursday.
Cutting off these platforms makes it harder for sanctioned entities to move and access funds, the Foreign Ministry said, adding that the A7 financial network claimed to have moved more than $90 billion last year, or nearly half of Russia’s annual military expenditure.
Blockchain analytics platform Chainalysis found that two of the sanctioned payment processors, Cryptomus and Heleket, received funds from thousands of illicit counterparties, peaking at 900 entities within a single month in late 2025.
Another sanctioned platform, the Kyrgyzstani TokenSpot exchange, was also tied to the A7 network. Chainalysis determined that TokenSpot, along with Grinex and Meer, received over $308 million from the same HTX deposit address.
In May, UK authorities included Huobi Global, the operator of crypto exchange HTX, in their sanctions package. HTX pushed back against the decision, arguing that the designation applies only to Huobi Global as a separate legal entity and said its online exchange and user funds remain unaffected.
Cointelegraph has approached TokenSpot, Cryptomus and Heleket for comment on the matter.
Meanwhile, the Russian ruble-backed A7A5 stablecoin processed $110 billion in cumulative onchain transactions leading up to June, continuing to grow despite the Western sanctions, according to CertiK.
Related: Italy’s central bank orders sanctions screening for crypto transfers
Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.
NFL Joins Prediction Markets Fight in Filing with US Supreme Court
The National Football League (NFL) largely sided with New Jersey officials in their petition for the Supreme Court to consider a case on sports bets through prediction markets platforms
In an amicus brief filed with the US Supreme Court on Wednesday, the NFL called on the justices to grant a petition for a writ of certiorari from New Jersey Attorney General Jennifer Davenport and gaming enforcement interim director Mary Jo Flaherty. The filing came in response to New Jersey officials petitioning the court to consider its case against Kalshi, potentially resolving whether the jurisdiction of prediction market companies falls under state authorities or federal agencies.
The football league supported many of the New Jersey authorities’ arguments, including that the case addresses potential issues with labeling sporting-event contracts on prediction market platforms as “swaps” and that it should be reviewed to “preserve game integrity” and “protect customers.” The group cited data showing that on the first Sunday of the football season, “more than half of all prediction-markets’ trading volume,” about $1.8 billion of $3.3 billion, related to the NFL.
According to the NFL, many of the sporting event contracts on Kalshi and other platforms were “highly susceptible to manipulation” or “otherwise inherently objectionable.”
“These bets, in the NFL’s view, pose the greatest threats to game integrity, because many can be manipulated by a single person, especially if known in advance—for instance, a player can alter his performance, a coach can change his team’s lineup, or an official can make (or not make) certain calls,” said the amicus brief.
Event contract on 2027 Super Bowl. Source: Kalshi
Related: New York sues Polymarket over alleged illegal gambling business
Also at issue, according to the NFL, was the lack of what it called “sensible safeguards” for event contracts from the Commodity Futures Trading Commission (CFTC). Federalizing sports betting regulation, rather than leaving it to individual US state authorities, was a “major question” the Supreme Court should consider.
As of Thursday, the Supreme Court had not announced whether it planned to grant review of the case. Kalshi was granted an extension to respond to the New Jersey filing, giving the company until Nov. 9 to address issues related to jurisdiction, manipulable event contracts, and consumer protection.
States want clarification from SCOTUS on prediction markets
On Wednesday, 39 US states and the District of Columbia also filed an amicus brief supporting New Jersey’s position, saying the conflict between the CFTC and state authorities over prediction markets had resulted in a “national turf war” that could not be resolved without an answer from the Supreme Court.
“Waiting too long to address this issue will permit the federal-state regulatory dispute to escalate,” said the filing. “The ongoing power struggle between the States and the CFTC highlights the unpredictability about what law applies—and to whom. Whether in this case, or in one of the many more cases sure to come, this Court should step in, resolve the circuit split, provide guidance to lower courts, clarify the CFTC’s authority, and provide the badly needed answer to the Question Presented.”
Kalshi spokesperson Dani Lever told Cointelegraph after the September New Jersey filing that the company could not be “regulated by 50 different regulators.“
Whether the Supreme Court justices will take up the issue of prediction markets is unclear. While New Jersey officials were the first to petition the high court to consider the Kalshi case, there were many examples of state-level actions against prediction market companies that could still face appeal.
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Crypto Must Cement Adoption Before 2028, Canton CEO Says
Digital Asset co-founder and CEO Yuval Rooz said the crypto industry should use the current regulatory environment to accelerate institutional adoption, arguing that widespread use of blockchain could make it harder for future administrations to reverse the industry’s progress.
Speaking at Token2049 in Singapore, Rooz said the industry should make blockchain so widely used that whatever happens in 2028, “there is no going back.” The next US presidential election, which could bring a change in administration and regulatory priorities, is scheduled for Nov. 7, 2028.
He compared the opportunity to Uber and Airbnb, where he argued both services became entrenched before policymakers could effectively restrict them. “By the time people got their act together and decided, OK, we wanna legislate against those companies, it was too late,” Rooz said.
The comments come after the CLARITY Act failed to advance in the Senate procedural vote in September. The Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) have pushed ahead with crypto regulations under their existing authority.
In the same Token2049 panel, Binance co-CEO Richard Teng said he hoped the CLARITY Act would still become law, arguing that legislation could prevent regulatory backtracking and encourage institutions to enter the market. He described the possibility of reversing current progress as “the biggest fear” for the industry.
Meanwhile, Franklin Templeton CEO Jenny Johnson said legislation would provide greater certainty but cautioned that the industry should not rely on the CLARITY Act passing. She said the SEC and CFTC were already working to provide regulatory clarity, allowing innovation and institutional adoption to continue.
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