Published on: January 13, 2025, 05:31h.
Last updated on: January 13, 2025, 05:31h.
The Commodities and Futures Trading Commission (CFTC) is reportedly considering reviewing Crypto.com’s newly introduced sports event contracts. However, this is unlikely to impact the company’s plans to offer derivatives on the upcoming Super Bowl.
Sources familiar with the situation informed Bloomberg News that the CFTC is currently voting on a proposal to subject Crypto.com’s sports event contracts to a 90-day review. Even if this review happens, it will conclude after the Super Bowl, set for Sunday, Feb. 9 in New Orleans.
Reports indicate that the CFTC is exploring whether Crypto.com’s sports contracts could potentially violate gaming laws. The brokerage firm announced its intention to offer these derivatives shortly before Christmas, and while it informed the regulatory agency, the CFTC did not have enough time to review the proposal due to the holiday season.
The company has described this new sports event trading platform as the first of its kind and stated that it will be offered by Crypto.com | Derivatives North America, which is overseen by the Commodities and Futures Trading Commission.
Opportune Timing for CFTC Examination of Crypto.com Contracts
The timing of the CFTC’s potential review of the sports event contracts on Crypto.com is noteworthy as President-elect Trump is set to assume office next Tuesday, becoming the 47th US president. This transition in leadership at the commission is not lost on Crypto.com.
It is disappointing that the current and soon-to-be outgoing CFTC leadership is considering this action without giving the incoming CFTC leadership the opportunity to shape how free markets operate under its administration,” a representative of the cryptocurrency broker conveyed to Bloomberg.
While Trump has not yet named a new chairman for the CFTC, his choices to lead the Securities and Exchange Commission (SEC) and the Treasury Department are perceived as more crypto-friendly than their predecessors. This has led to speculation that a change in leadership at the CFTC could benefit Crypto.com and other financial entities interested in offering event contracts.
Indicating growing efforts by event wagering platforms to gain regulatory approval, Donald Trump Jr. is joining Kalshi — a major player in the sector — as a strategic adviser.
Entrance of Sports Event Contracts into Wagering Industry
Several brokerage firms, including Crypto.com, have shown interest in entering the event contract market, particularly focusing on sports derivatives.
If these contracts receive regulatory approval, they could pose a significant competitive challenge to traditional sportsbook operators, as these operators gain approval to offer iGaming and sports wagering on a state-by-state basis. In contrast, firms like Crypto.com and Kalshi are regulated at the federal level and can provide their trading services across all 50 states. Currently, sports wagering is allowed in 38 states and Washington, DC, with Missouri set to join later this year.
Last week, Crypto.com expanded its sports event contracts to include the NFL conference championship and the final three games of the college football playoffs (CFP).