CFTC Proposes Event Contracts as Swaps; FinCEN Withdraws Wallet, Mixer Rules
Two CFTC rulemakings on crypto spot-style and event contracts, FinCEN's withdrawal of unhosted-wallet and mixer proposals, and accelerating state-versus-CEA prediction markets litigation.
Early October brought two CFTC crypto rulemakings, two FinCEN withdrawals and several prediction-markets litigation moves. An Oct. 5 ANPRM seeks comment on "fit-for-purpose" CEA rules for retail leveraged or margined crypto agreements, floats a "crypto asset market" DCM subcategory, and tentatively reads "actual delivery" under Section 2(c)(2)(D) as wallet transfer rather than book transfer. An Oct. 9 NPRM would expressly define event contracts — sports, politics, cultural, weather — as swaps, while a same-day interim final rule codifies the exclusion of casino-style gambling products; a time-limited no-action letter separately lets DCMs convert broad-based index futures into true perpetuals. FinCEN withdrew its 2020 unhosted wallet recordkeeping proposal and 2023 mixer Section 311 proposal, citing comments, deregulatory priorities and impractical compliance burdens. On litigation, 39 states and D.C. sought certiorari in the New Jersey sports-event preemption case, a CFTC-registered intermediary appealed a Connecticut injunction denial to the Second Circuit with CFTC support, and an Illinois court preliminarily enjoined part of state enforcement. Comment deadlines run 60 days for the ANPRM and 30 for the NPRM and interim final rule.