K&L Gates Publishes Prediction Market Report

In August, K&L Gates published a report titled “2026 Mid-Year Prediction Market Report: Uncertainty Prevails Amidst Extraordinary Federal Action.” The report highlights recent actions by the Commodity Futures Trading Commission (CFTC) to protect its asserted exclusive jurisdiction over prediction markets which are the venue for trading event contracts. According to K&L Gates these actions include wide-ranging public remarks by CFTC Chairman Michael Selig, outlining a broad regulatory program, a set of lawsuits and case filings across the country, and a series of administrative measures, including proposed rulemakings.

The report notes that a few registered products have entered the space. The report highlights that in April 2026, “sponsors filed registration statements with the SEC for additional prediction market ETFs on other topics such as the price of cryptocurrencies and oil next year and whether there will be a recession in the future, and ETFs investing in contracts related to sports outcomes are also in registration.” In response to these applications, the SEC issued a Request for Comment on Novel ETFs encouraging stakeholders and investors to provide their thoughts on whether these contracts should be offered in an investment company. The report notes that managers wishing to launch a product of this type may want to prepare for regulatory inquiries, update policies and procedures, and examine the need to register with the CFTC.

Click here to read the K&L Gates report on prediction markets.