Due to a rule violation, the United States Commodities Futures Trading Commission (CFTC) has asked PredictIt to close markets by the end of February 15, 2023.
According to the CFTC, PredictIt hasn’t complied with its rules for running the well-known website.
The CFTC has now withdrawn the no-action letter sent to Victoria University of Wellington, New Zealand, the site’s operator, eight years ago, stating that it has not operated its market in compliance with the terms of the letter.
PredictIt was able to accept bets from its traders on uncertain outcomes like presidential elections, whether the U.S. Senate will pass a reconciliation bill by September 2 and others.
However, regulators consider the activity to be similar to gambling or unregistered futures contract sales.
PredictIt is one of many prediction sites that run political markets to collect election data. It’s against the law to bet on the presidential election in the US.
The CFTC forbids trading in futures contracts that are not registered. According to the CFTC, PredictIt’s protected status was revoked last week because the company didn’t follow the letter’s instructions.
PredictIt in response to the CFTC asserted that it was conducting markets in accordance with the established regulations. Well, CFTC still hasn’t noted which rules in the letter has PredictIt violated.
The website also stated that in light of the agency’s choice, it would not be adding new events for users to wager on but would still accept payments and enable withdrawals.
Also Read: New US Senate Bill to Make CFTC the Official Crypto Regulator