ProphetX asks CFTC to preserve peer-to-peer prediction markets

The company said its recommendations include protecting competitive price formation, allowing affiliated liquidity to supplement rather than displace independent participants, and using Section 4(c) of the Commodity Exchange Act to provide a conditions-based framework for eligible sports event contracts. Those are ProphetX's policy proposals, not a CFTC decision.

Exchange model versus sportsbook model

“A two-sided, peer-to-peer exchange model operating under durable federal oversight is not simply another way to package the state sportsbook model,” Sisun said in the release. He described the exchange model as one in which users trade against one another rather than against an operator holding a directional position.

The CFTC's Aug. 20 Innovation Advisory Committee meeting is part of a broader policy debate over event contracts and market structure. The agency's agenda does not itself establish that any particular proposal has been accepted, approved or made available to U.S. traders.