The CFTC is set to vote on whether the new futures contracts from Crypto.com, which allow investors to wager on major football games, including the Super Bowl, should undergo a 90-day review.
Sources indicate that the five-member federal commission is considering an investigation into Crypto.com in relation to these futures contracts tied to the outcomes of significant sports events.
The CFTC has yet to decide if the contracts available on Crypto.com’s Chicago-based derivatives exchange infringe upon laws regarding betting contracts. The agency historically opposes contracts that facilitate betting on sports outcomes and other activities deemed contrary to public interest.
Crypto.com launched its sports contracts on January 7, following necessary legal protocols, and informed the CFTC of the impending launch on December 19, shortly before the holiday season. Due to the timing, the agency did not have adequate opportunity to review the contracts prior to their release.
The firm originally hesitated to introduce this product during the holiday period but proceeded due to concerns over a potential government shutdown that could hinder trading opportunities for the Super Bowl, according to a representative from Crypto.com.
In response to inquiries, Crypto.com’s spokesperson mentioned the company has not received notice of any ongoing actions from the CFTC, expressing disappointment that current CFTC leadership would consider such measures before handing over responsibility to the incoming administration.
A representative from the CFTC declined to comment on the situation when approached.
While Crypto.com’s sports contracts do not explicitly name the events, they refer to them as “Bowl games,” “Pro Football Conference Championships,” and “College Football Championships” on their platform. However, the app does display official game names for users aged 18 and older to bet on events like the AFC Championship and the Super Bowl.
In a previous instance, the crypto trading platform ErisX had proposed similar sports-related contracts in 2021 but retracted its application before the CFTC could vote on it.
The U.S. sports betting market is primarily dominated by established platforms, with mobile sports betting permitted in 30 states, including Washington D.C.
Furthermore, the unregulated exchange Polymarket offers betting on Super Bowl outcomes and various sports matches while claiming such contracts are unavailable to its U.S. users.
In recent developments, the CFTC took action against betting on Kalshi Inc. and other exchanges relating to a high-profile criminal case.
