The U.S. Commodity Futures Trading Commission (CFTC) has cautioned prediction market platforms against using American-style "moneyline" betting odds, describing such practices as potentially "deceptive," according to Bloomberg.

The platforms at issue allow users to trade contracts tied to the outcomes of real-world events—spanning elections, sports, economics, and entertainment—and have seen rapid user growth, drawing greater regulatory scrutiny to how contracts are structured and presented.

The agency sent letters to regulated entities urging compliance with federal law and warning against deceptive conduct in the way contracts are listed and advertised.

LATEST: 🇺🇸 The CFTC warned prediction market platforms against using American-style "moneyline" betting odds, calling such practices potentially "deceptive," per Bloomberg. pic.twitter.com/LoxyrClXVz — CoinMarketCap (@CoinMarketCap) August 8, 2026

Understanding American Odds vs. Contract Prices

American odds, commonly known as moneyline odds, express the amount that must be wagered to win a set sum—typically based on a $100 bet—using positive and negative figures. Prediction markets, by contrast, traditionally operate on contract prices. For example, a contract priced at 50 cents implies an estimated 50% probability of an outcome. American odds can be derived from these prices using standard conversion formulas.

The CFTC reportedly cited a study suggesting that American-style odds may encourage gamblers to assume greater risk. That research underpinned the agency's advisory to online platforms regarding how they present betting odds.

Kalshi Pledges Compliance

Kalshi, one of the leading prediction market providers, indicated it will adhere to the CFTC's guidance.

"Being a federal exchange, Kalshi will comply with the CFTC guidance in letter and spirit by its deadline," a company representative stated in an emailed response.

Broader Jurisdictional Dispute

The notice arrives amid a broader dispute over which level of government holds regulatory authority over prediction markets in the United States. The CFTC's oversight of these markets stems from the Commodity Exchange Act, which governs derivatives and designated contract markets, giving the agency a framework for regulating event-based contracts.

CFTC Chair Michael Selig has consistently asserted that the federal agency possesses exclusive jurisdiction over prediction markets. He has launched rulemaking efforts targeting the industry and maintains that existing federal legislation grants the CFTC broad regulatory authority in this area. The commission has also filed lawsuits against several states challenging their attempts to assert oversight.

Several states have pushed back, arguing that certain prediction market activities fall within the scope of state-level gambling and sports betting legislation. The stakes of this debate have grown as prediction platforms have rapidly expanded, with some reaching valuations in the billions.

Both Polymarket and Kalshi have expressed support for federal oversight through the CFTC. However, some U.S. senators, along with tribal gaming regulators, are seeking legislation that would preserve state sovereignty over sports betting regulation.

The CFTC's latest warning adds another dimension to the ongoing debate over prediction markets in the U.S. and the extent of federal authority over sports wagering.