CLARITY Act Could Help CFTC Regulate Prediction Markets With Additional Resources, Lawyer Says

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According to Carl Kennedy, a partner at New York law firm Katten Muchin Rosenman, the CFTC is likely too "short-staffed" to effectively regulate prediction market platforms like Kalshi and Polymarket. Speaking at a Tuesday hearing held by the US House Committee on Agriculture's Subcommittee on Commodity Markets, Digital Assets, and Rural Development, Kennedy said the Digital Asset Market Clarity (CLARITY) Act under consideration in the US Senate could grant the commodities regulator additional authority to address both digital assets and the "explosive growth of prediction markets." Kennedy stated: "With additional resources and additional authorities under the CLARITY Act, the CFTC should receive additional resources to address these new asset classes and deal with the explosive growth of prediction markets." The hearing comes amid ongoing regulatory tensions between CFTC Chair Michael Selig and state authorities over jurisdiction of prediction markets, with some states filing lawsuits against prediction market platforms.
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