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CFTC says designated contract markets must drop domestic geographic access limits within 30 days
Summary
The Commodity Futures Trading Commission on Thursday issued an interpretation of Commission Regulation 38.151(b), the Impartial Access Requirements that require designated contract markets (DCMs) to provide competitive, open, fair and impartial access to members and persons with trading privileges.
Chairman Michael S. Selig said derivatives markets "must operate on a uniform basis at a national scale" under the Commodity Exchange Act, and that "geographic access restrictions are inconsistent with those purposes and the Act's impartial access requirements."
DCMs must cease domestic geographic restrictions that violate the Impartial Access Requirements within 30 days, or else submit to the Division of Market Oversight an explanation for why compliance is not feasible, the CFTC said.
Within the same 30 days, DCMs should ensure intermediaries accessing their markets are not impeding and are complying with the DCM's Impartial Access Requirements, or else submit a similar feasibility explanation; the Commission said it will consider facts and circumstances in any particular case.
Updates
- Update, : Update (Nov. 6, 6pm): CoinDesk reported the interpretation puts federally registered DCMs—including Kalshi and Polymarket—in tension with court orders that require geofencing, giving firms 30 days to restore nationwide access or explain why they cannot. CoinDesk cited recent Second Circuit action affecting Kalshi and Coinbase in New York/Connecticut matters, the Ninth Circuit tribal-gaming ruling that led to a California tribal-lands access block, and a Friday X post from Sen. Adam Schiff accusing the CFTC and Chairman Mike Selig of encouraging platforms to offer products "in contempt of these court orders." A Kalshi spokesperson did not respond to CoinDesk by press time; Better Markets praised the court rulings against unrestrained prediction markets.
Key facts
- The interpretation applies to designated contract markets under CFTC Regulation 38.151(b).
- Selig: "Derivatives markets must operate on a uniform basis at a national scale in order to achieve the purposes set out in the Commodity Exchange Act."