Prediction market roundup: CFTC to review mention markets, reports state

One of the more controversial offerings on prediction markets involve certain event contracts that allow users to profit if a speaker utters specific words or phrases during a closely-watched appearance.

The so-called “mention markets” received added scrutiny last month when reports surfaced of a probe against a longtime White House teleprompter operator. The White House placed Gabe Perez on unpaid leave following allegations that he placed more than a dozen trades on speeches delivered by US President Donald Trump, netting around $100,000 on Kalshi. Now, the US Commodity Futures Trading Commission has launched a review on mention markets, NPR reported on 13 August.

White House Press Secretary Karoline Leavitt, who announced her resignation this week, called Perez a “disgrace” for his alleged infractions. Kalshi’s surveillance team flagged a series of trades made by Perez, then froze approximately $90,000 in potential wins. The operator subsequently informed the CFTC of the suspicious trades. Trump also ordered Perez to be placed on leave, triggering a review by the federal regulator on derivatives.

This year, prediction market operators have increasingly offered mention markets for broadcasts of popular sports contests. During the FIFA World Cup, for instance, operators handled millions in trading volume on the contracts. Kalshi has since pulled all sports-related mention markets.

Neither the CFTC nor Kalshi have issued a statement on the potential review.

CFTC issues guidance on self certification for incentive programs

In an effort to curb deficiencies associated with the self-certification of incentive programs on prediction markets, the CFTC issued new guidance on filing rules 12 August.

With the guidance, the CFTC is putting operators on notice to meet their regulatory obligations when submitting self-certifications for incentive, market making, liquidity and trading programs. The advisory, according to the CFTC, concerns an “increasing number” of self-certifications for incentive programs that contain “procedural or substantial deficiencies”, the agency wrote in a statement. Since the incentive programs can alter trading behaviours and fee structures, the CFTC aims to establish transparency through its regulatory oversight.

Regulated prediction markets are also known as Designated Contract Markets, or a class of licencees authorised to list derivative markets under the Commodity Exchange Act. Although DCMs may offer different fee structures for various traders, the fees must remain comparable and proportionate to the program’s objectives, the agency states. The guidance advises DCMs to avoid preferential treatment, including VIP access to products without “formal disclosures to the market and market participant”.

Outside of prediction markets, sportsbook VIP programs have received heightened media attention in recent weeks. In the days leading up to the Major League Baseball All-Star Game, reports surfaced that Philadelphia Phillies star Bryce Harper filmed a personalised video to a VIP bettor thanking him for his support. The bettor, Terry Thompson, subsequently sued FanDuel, claiming the company enticed him to return to the site through various VIP perks.

Thompson has sought treatment for a gambling addiction which he claims is responsible for incurring losses of at least $1.5 million. Earlier this week, Senator Richard Blumenthal and two members of the US House of Representatives wrote a letter to the MLB Players Association recommending the ban of advertising tied to VIP betting programs.

Report: JPMorgan debanked Polymarket in 2025

As prediction markets rapidly expanded last year, JPMorgan Chase & Co. terminated its banking relationship with Polymarket, according to a new report this week.

The bank severed the relationship due to regulatory concerns, the Financial Times reported. Polymarket, which is seeking a valuation around $20 billion, initially settled with the CFTC in 2022 for operating an unregistered platform. Last September, the CFTC approved Polymarket’s bid to relaunch a platform in the US. Polymarket operates a platform for US traders that is separate from one available for international users.

Polymarket, according to the FT, is in the process of procuring a new lender. While JPMorgan did not comment for the story, Polymarket wrote in a statement that it continues to maintain an “active relationship” with the bank across multiple entities, including the handling of “customer fund flows”.

The dual-platform structure has led to sharp criticism of the offshore app. Under CFTC Rule 40.11, DCMs are prohibited from listing event contracts pertaining to war, assassination or terrorism. On Friday, Polymarket’s offshore platform continued to list a contract on whether Luigi Mangione would go to trial in 2027.

Mangione, 28, admitted in New York federal court on Friday that he shot former UnitedHealthcare CEO Brian Thompson in 2024 with the intention of killing him. Mangione now faces sentencing in December. The odds of a 2027 trial plunged on Friday prior to Mangione’s hearing, as the defendant’s attorneys held last-minute negotiations with prosecutors.