Dragonfly Joins Crypto.com, Coinbase in Opposing CFTC’s Proposed Ban on Prediction Markets

Odaily News Jessica Furr from Dragonfly Digital Management and consultant Bryan Edelman wrote to the U.S. CFTC: "Political event contracts should not be equated with gambling activities such as the Super Bowl. Elections have significant economic impacts, and these contracts are designed to provide key risk hedging functions, comply with the requirements of the Commodity Exchange Act (CEA), and provide the public with valuable forecasting data." Dragonfly also believes that the CFTC's proposed rules are suspected of overstepping their authority because they broadly prohibit market predictions that have not been properly evaluated, especially in light of the Supreme Court's recent ruling on the "Chevron" case, which limits the CFTC's right to interpret without congressional authorization. In addition, Joseph Fishkin, a law professor at the University of California, Los Angeles (UCLA), also pointed out that prediction markets provide valuable insights into public opinion and political events and should not be regulated in a way that closes prediction markets in the United States. (CoinDesk) Previously, the U.S. CFTC voted in May to pass a rule that, if finalized, would prohibit betting on contracts for events in political contests and other fields, and such contracts would not be allowed to be listed for trading or clearing through CFTC-registered entities. Earlier this week, Senator Elizabeth Warren urged CFTC Chairman Rostin Behnam to "quickly" finalize rules prohibiting political event contracts. In response, Crypto.com Senior Vice President and Global Head of Capital Markets and Law Steve Humenik and Coinbase Chief Legal Officer Paul Grewal successively expressed opposition.