CFTC demands registration and industry debates prediction-market risks
Regulators and executives debated $18bn parlays, integrity and offshore platform oversight at NEXTPredict.
Key Takeaways
- The Commodity Futures Trading Commission asked large offshore prediction-market platforms operating in the U.S. to register so the agency can monitor activity.
- Parlays in prediction markets represented about $18 billion in risk exposure over seven days, according to White Swan Predicts.
- White Swan Predicts prices roughly 120 million parlays daily and reported about 20% weekly growth in the first five weeks of the NFL season.
- Polymarket removed a market about an alleged Cornell sexual assault, and the CFTC has issued notices about contracts vulnerable to manipulation.
- Operators such as Robinhood have avoided offering certain markets for integrity reasons, while DraftKings says it has a collaborative relationship with the NFL.
The Commodity Futures Trading Commission asked that large prediction-market platforms operating in the United States register, and the industry outlined a surge of parlays totaling $18 billion over seven days at the NEXTPredict conference on 22 October 2026 in New York. Regulators and executives discussed compliance, a market recently removed by Polymarket and integrity risks linked to parlays and potential insider trading.
CFTC request for registration and oversight
David Miller, Director of Enforcement at the Commodity Futures Trading Commission, said the agency wants large offshore platforms that operate in the U.S. to register with the commission so it can monitor their activity. Miller said the CFTC has issued notices warning that certain event contracts could violate federal rules or be susceptible to manipulation, citing contracts tied to sports injuries as an example.
"We want to make sure that the FTXs don't happen again," Miller said, referring to the collapsed cryptocurrency exchange.
Miller declined to comment on internal conversations about a controversial market on an alleged sexual assault at Cornell University that Polymarket removed from its international platform that week. He also addressed the application of insider-trading laws to prediction markets and posed a hypothetical example involving Venezuelan President Nicolás Maduro that might not necessarily breach federal insider-trading law though it could violate an exchange's rules.
Parlay volumes and price dynamics
Bernard Marantelli, CEO of White Swan Predicts, said parlay-style contracts in prediction markets represented roughly $18 billion in industry risk exposure during the seven days ending the Tuesday before the conference. Marantelli said his firm prices about 120 million parlays daily and that the $18 billion figure grew by around 20% weekly during the first five weeks of the NFL season; he projected it could reach $30 billion by Christmas or early January.
Marantelli summed up the trend: "The growth rate is out of control, really." Unlike traditional sportsbooks, these systems allow multiple market makers to compete to price the same parlay, which can offer better odds and new revenue opportunities for firms like White Swan and established books such as DraftKings and FanDuel.
Polymarket noted, via Jacob Meleka, its RFQ technical lead, that its platform processes thousands of quote requests and tens of thousands of quotes per second.
Integrity concerns and operator responses
JB Mackenzie, vice president at Robinhood, said his company has discussed matters with professional leagues and has avoided offering certain player-linked contracts over integrity concerns. Mackenzie added that Robinhood did not offer markets the NFL and NBA specifically asked to avoid, because reputational risk outweighed potential revenue.
DraftKings CEO Jason Robins defended his company's relationship with the NFL and said the league appeared more confident in DraftKings' safeguards than in some competitors': "I do think that we built the collaborative relationship where they feel more comfortable that we're taking the safeguard measures that are necessary and maybe don't feel as much that way of some of the other participants in the market," Robins said.
Jenni Kennedy, senior director of investigations at the International Tennis Integrity Agency, reported an anecdotal increase in "courtsiders" using prediction markets; she warned that instant payouts in these markets can create integrity risks that traditional bookmakers mitigate with bet acceptance delays. Kennedy added they have also seen a rise in attempts by those "courtsiders" to contact players.
Regulation and ongoing litigation
The discussions took place amid state and federal lawsuits over the legality of prediction markets, growing scrutiny from professional sports leagues and investigations into possible manipulation and insider trading. The CFTC and operators remain at the center of that regulatory and legal debate. [/regulation]
Frequently Asked Questions
What exactly did the CFTC request about prediction-market platforms?
The CFTC requested that large offshore platforms operating in the United States register with the commission so it can monitor their activity. Enforcement Director David Miller said the agency has issued notices warning that certain contracts may be vulnerable to manipulation or violate federal rules.
How large were parlays in prediction markets recently?
Parlays in prediction markets accounted for roughly $18 billion in industry risk exposure during the seven days ending the Tuesday before the NEXTPredict conference, according to Bernard Marantelli of White Swan Predicts.
What integrity concerns did sports leagues raise?
Leagues raised concerns about contracts susceptible to manipulation and the use of insider information; operators reported avoiding markets the NFL and NBA asked to remove, and the International Tennis Integrity Agency noted an increase in "courtsiders" attempting to contact players.
What examples did the CFTC give of problematic contracts?
David Miller cited contracts tied to sports injuries as examples of potentially problematic markets and referenced the market Polymarket removed regarding a reported assault at Cornell as a case the agency has discussed.
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About the author
Renata Quiroga
Betting Markets Correspondent
Renata Quiroga covers sports betting and prediction markets — sportsbook launches, odds technology, event contracts, and the regulatory calls that decide what can be bet on and where. The reports open with the product or the ruling, name operators and platforms precisely, and explain the mechanics without needless jargon. When a book enters a Latin American market or a prediction exchange lists a contested contract, Renata Quiroga reports what changes for the bettor.
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