Better Markets filed a comment letter urging the SEC—not the CFTC—to regulate event contracts tied to public companies’ key performance indicators such as sales growth and customer metrics.
The group said prediction-market platforms are seeking legal cover and lighter oversight from the CFTC, while existing rules and the SEC’s investor-protection mandate make the securities regulator the proper overseer.
SEC supervision would better guard against insider trading, market manipulation and misleading advertising, Better Markets argued, and the agencies should clarify SEC jurisdiction if any ambiguity remains.
The nonprofit, founded after the 2008 financial crisis, warned that shifting these contracts toward CFTC oversight would further blur the line between investing and gambling and increase risks for retail investors.