US agency says no to political betting on exchanges

As the momentum for the upcoming Presidential clash in November builds up, watchdogs in the United States have to also worry about how political betting markets may sway public opinion to back one candidate or the other.

To this end, The Commodity Futures Trading Commission (CFTC) has issued a recent update in which it called for the suspension of peer-to-peer exchanges which enable political wagers. Although political betting is prohibited on regulated sportsbooks, peer-to-peer exchanges have been able to skirt federal regulation and offer an alternative opportunity.

Not least, there are offshore and overseas operators that accept wagers from not just the United States, but anywhere worldwide, generating a steady betting handle on a race as big as the Presidential election in the United States. However, the CFTC wants to make sure that on a regulatory level, political events, and other betting events, are excluded from such betting exchanges in the first list.

The proposed amendment by the CFTC wants to do away with any betting markets that have to do with gaming, war, assassination, or terrorism, as well as anything "unlawful under any federal or state law," which is a vast net to cast in the hopes of acting pre-emptively against bad actors.

The CFTC has faced pushback over the years, as this is not the first time the Commission has tried to protect the electoral process in the country, citing concerns about undermining its integrity. Yet, some betting operators running such markets have historically argued that the generated volume of bets and the way the public wagers on one candidate or the other could actually be used for academic and research purposes and help inform political campaigners in the future.

However, the CTFC worries that with the increase of betting activity, occasioned by the overturning of PASPA, there has been a notable increase in the number of political wagers placed across various platforms, pointing to the fact that some political wagers may be placed in a pure attempt to sway public opinion.

"The Commission has recently received applications for exchange registration, and expressions of interest regarding registration, from entities indicating that they are interested in listing event contracts for trading," the CFTC said in a statement.

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