In her CryptoSlate article, “The bets that made crypto prediction markets popular now targeted by ban threat,” Reporter Andjela Radmilacfor writes that crypto prediction markets are entering a critical phase as regulators, states, and lawmakers move to redefine how these platforms operate.
At the center of the debate is a single question: Are prediction markets bets—or swaps?
CM Law Partner Linda Goldstein explains the stakes: “If these transactions are bets, states regulate them. If they’re swaps or derivatives, then the CFTC has the lead role.”
The answer will determine not just oversight, but whether current business models can survive.
Sports contracts, which may account for up to 90% of activity, have driven massive growth, but also intensified scrutiny. According to Goldstein, “These contracts are directly competing with licensed sportsbooks,” which have reportedly lost over $600 million since 2025.
Now, proposed legislation could ban sports-related contracts on federally regulated prediction markets altogether, putting the industry’s primary growth engine at risk.
As pressure mounts, prediction markets may need to prove they are fundamentally different from gambling, or face significant restrictions.
If you have questions about prediction markets, please connect with Linda directly at lgoldstein@cm.law. To read the entire article, click here.
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