US CFTC Warns 'Reference Market' Prediction Contracts Pose High Manipulation Risks

The Market Oversight Division of the U.S. Commodity Futures Trading Commission (CFTC) announced that prediction contracts settled based on whether specific individuals mention certain words or attend events face significant market manipulation risks and may only be listed on designated contract markets under limited circumstances. The CFTC recommends that relevant platforms assess whether individuals who can influence the outcome of a contract are bound by legal, professional, contractual, fiduciary, or confidentiality obligations, and implement proactive trading rules and risk control measures to prevent manipulation.