The Commodity Futures Trading Commission has told regulated prediction-market operators to stop using American-style “moneyline” odds in certain contracts, placing fresh limits on how platforms present risk to retail users as event trading expands into areas long associated with sports wagering.
Letters sent by the agency instructed regulated entities to comply with federal law and avoid “deceptive” practices in the listing, advertising, and solicitation of contracts, according to a letter obtained by Bloomberg on Friday. The guidance focuses on a display format familiar to sports bettors but less common in prediction markets, where contracts are generally quoted in cents to reflect an implied probability.
A spokesperson for Kalshi said the platform would follow the CFTC’s guidance and comply with the stated deadline. Polymarket and the CFTC did not respond to Bloomberg’s requests for comment.
CFTC focuses on how risk is displayed
American moneyline odds use plus and minus signs to show the potential return or required stake on a wager. Positive odds indicate the profit from a $100 stake, while negative odds show how much must be risked to generate a $100 profit.
Prediction markets have generally relied on a different format. A contract priced at 60 cents indicates that the market places roughly a 60% probability on the outcome, while a 40-cent contract implies roughly a 40% chance. The buyer of a winning contract receives $1 at settlement.
The two systems can represent the same underlying probability, but their presentation can lead users to view risk differently. Contracts below 50 cents translate into positive American odds, while contracts above 50 cents translate into negative odds. The CFTC cited a study in its letter finding that American-style odds encouraged greater risk-taking in sports betting, Bloomberg reported.
The agency’s intervention could require platforms to make changes beyond simply removing a plus or minus sign. Marketing materials, trading interfaces and customer prompts may need to emphasize contract prices and implied probabilities rather than sports-betting terminology. That approach would keep the presentation of event contracts closer to the financial-market model the CFTC has sought to apply to prediction markets.
Federal regulator presses its jurisdiction claim
The warning arrives as the CFTC, under Chair Michael Selig, has taken an increasingly assertive stance on its authority over prediction markets. Over the past year, Selig has argued that the agency has exclusive jurisdiction over the sector and has sued several states in support of that position, according to the supplied materials.
The CFTC has also begun a rulemaking effort related to the industry. Selig has maintained that the Commodity Exchange Act gives the regulator broad authority to oversee event contracts, despite objections from states that regulate sports betting and other gambling activity under local laws.
That conflict has become sharper as prediction-market platforms list contracts tied to sports, elections, economic data and other real-world outcomes. State authorities and tribal gaming regulators have argued that contracts resembling sports wagers can intrude on state-regulated gaming markets, even when the contracts are offered through federally regulated venues.
Recent legislative pressure reflects the same divide. Senators and tribal gaming regulators have pushed for language that would preserve state authority over sports betting and prevent prediction markets from expanding freely into that category, according to the supplied materials.
The CFTC’s focus on moneyline displays addresses a narrower issue than the jurisdictional fight, but it places consumer-facing design choices under federal scrutiny. A platform could offer a federally regulated event contract while being asked to avoid language and odds formats that make the product resemble a conventional sportsbook wager.
Growing volumes raise stakes for platforms
The debate is unfolding while activity on prediction platforms is rising rapidly. The supplied materials state that approved event platforms recorded an 866% increase in trading volume in early 2026 compared with the prior year. They also state that the largest blockchain-based betting application handled more than $10 billion in monthly trading during March, including $425 million in activity on a single day in February.
Those figures illustrate why the presentation of contracts has become a regulatory concern rather than a minor interface decision. As more users encounter event-based markets, the format used to communicate odds can influence whether they interpret a position as a probability trade, a speculative wager or something in between.
For platforms, the immediate consequence is likely to be a review of user interfaces and promotional language. Kalshi’s response indicates that at least one major operator intends to follow the CFTC’s direction. The response from Polymarket remains unclear following Bloomberg’s request for comment.
Probability pricing may become the default
A cents-based contract price is generally more direct for users trying to assess a market’s forecast. A contract at 25 cents signals a one-in-four implied chance before fees and market dynamics; a contract at 75 cents signals a three-in-four implied chance. Moneyline odds can express the same information, but require users to translate between odds, stake sizes and expected returns.
The CFTC’s warning therefore extends the regulator’s approach beyond deciding which entity can list event contracts. It would also shape how those contracts are explained to the public, reducing the use of sports-betting conventions on platforms operating under the agency’s oversight.
The move leaves unresolved whether states and tribal regulators can limit access to sports-related prediction contracts within their borders. Those disputes will continue alongside the CFTC’s rulemaking and litigation, while regulated platforms face a more immediate requirement to reconsider the odds formats shown to their users.
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