The US Commodity Futures Trading Commission (CFTC) has launched an investigation into the Super Bowl markets offered by popular cryptocurrency platform Crypto.com and prediction market platform Kalshi. The CFTC is seeking to understand how these platforms are complying with derivatives rules, according to sources familiar with the matter.

The Super Bowl, one of the biggest sporting events in the United States, attracts millions of viewers and billions of dollars in bets each year. With the rise of cryptocurrency and the growing popularity of prediction markets, it’s no surprise that these platforms are now offering markets for the Super Bowl.

However, the CFTC is concerned about the potential risks and regulatory implications of these markets. As a regulatory body responsible for overseeing the derivatives market, the CFTC wants to ensure that these markets are operating within the boundaries of the law and protecting consumers.

Crypto.com, a leading cryptocurrency platform, has been offering Super Bowl markets since 2019. The platform allows users to bet on the outcome of the game using cryptocurrency, with options for traditional bets like the winner and the point spread, as well as more unique bets like the coin toss and the length of the national anthem.

Kalshi, a prediction market platform, also offers Super Bowl markets where users can bet on the likelihood of various outcomes, such as the MVP, the total number of points scored, and even the color of the Gatorade shower. These markets are based on the concept of crowd wisdom, where users can buy and sell shares in different outcomes, similar to the stock market.

While these markets may seem like harmless fun, the CFTC is concerned about the potential for market manipulation and insider trading. They are also looking into whether these markets are properly registered and following the necessary regulations for derivatives trading.

As the investigation continues, both Crypto.com and Kalshi have assured their users that they are cooperating with the CFTC and are committed to complying with all regulatory requirements. In the meantime, users can still enjoy the excitement of Super Bowl betting, but with the added assurance that these markets are being closely monitored by the CFTC.