The U.S. Commodity Futures Trading Commission (CFTC) issued no-action relief from certain swap-related reporting and recordkeeping requirements for fully collateralized event contracts, easing compliance for prediction market venues and their clearing counterparts. The move aims to reduce administrative burden on designated contract markets (DCMs) and derivatives clearing organizations (DCOs) that list and clear such contracts, while preserving regulatory oversight where appropriate.

The CFTC’s market and clearing divisions stated they would not recommend enforcement against DCMs, DCOs, or their participants for not adhering to specified swap-related recordkeeping or for reporting covered transactions to swap data repositories. The agency framed event contracts on prediction markets as binary-outcome swaps in theory, yet described them as instruments that often resemble futures or futures options in practice, suggesting they may be reported to the CFTC in a manner akin to futures. The agency also named 19 platforms—including Kalshi, Polymaket, and Gemini Titan—and indicated that other firms seeking to list similar contracts could request a no-action letter.

The no-action relief responds to multiple requests from market operators that list and clear event contracts and the CFTC indicated it expects additional similar requests in the future. The relief could meaningfully reduce compliance complexity for CFTC-regulated prediction-market venues as the agency continues to defend its jurisdiction in the face of state-level gambling regulation challenges.

According to Cointelegraph, the move arrives amid a broader federal–state dispute over how these markets should be regulated—whether as derivatives under federal law or as gambling products regulated by state authorities. The CFTC has been advancing its view of exclusive federal jurisdiction in several high-profile matters, underscoring the tension between federal regulation and state laws on prediction markets.

Key takeaways

• No-action relief: The CFTC will not pursue enforcement against DCMs, DCOs, or their participants for certain swap-related recordkeeping and swap-data-reporting obligations in relation to fully collateralized event contracts.
• Scope and reporting: Event contracts—though binary by design—are treated as swaps in theory, but the CFTC indicates they can be listed and reported with mechanisms similar to futures and futures options.
• Platform coverage: The relief names 19 platforms, including Kalshi, Polymaket, and Gemini Titan, with the option for others to seek no-action from the agency.
• Regulatory posture: The relief reflects ongoing efforts to reconcile federal derivatives regulation with state gambling authorities, a conflict that includes lawsuits and amicus filings in federal courts.

No-action relief: scope and rationale

The CFTC’s writedown of enforcement risk centers on fully collateralized event contracts listed on designated markets. By carving out a relief path, the agency acknowledges that many of these contracts function in ways more akin to futures and options than to traditional swaps, despite their binary-event underpinnings. The relief allows listing venues and clearinghouses to maintain listing and clearing operations without triggering automatic enforcement for specific swap-recordkeeping deficiencies or for failing to report certain events to swap data repositories.

Key platforms identified by the agency—such as Kalshi, Polymaket, and Gemini Titan—are included in the relief’s scope, which also clarifies that other platforms seeking to list similar contracts may apply for no-action relief. The intent appears to be reducing administrative friction for CFTC-regulated prediction-market operators while preserving the agency’s oversight posture should issues arise in the future.

The development is framed as a practical accommodation in response to a wave of compliance requests from DCMs and DCOs that list and clear event contracts. The CFTC signaled it expects further such requests, suggesting a continued alignment between enforcement discretion and market development in the prediction-market space.

Regulatory context and enforcement posture

At a broader policy level, the no-action relief sits within a contentious regulatory landscape where the CFTC seeks exclusive jurisdiction over prediction markets, but state authorities have pursued gambling-regulation actions against the same platforms. The agency has engaged in high-stakes litigation and court filings to defend its authority, including an amicus brief in the Sixth Circuit aimed at limiting state actions perceived as intruding on federally regulated markets. Ohio’s attempts to regulate or restrict sports-event contracts have been a focal point of these disputes, resulting in Kalshi pursuing a federal court challenge that has progressed through the courts with varying outcomes.

The CFTC’s March staff advisory that categorized event contracts on prediction markets as a distinct financial asset class adds another layer to the regulatory framework, signaling that the agency views these instruments through a broadly defined, potentially cross-cutting lens. In parallel, the agency’s forthcoming rulemaking—shortly after soliciting public comments—has drawn a wide range of responses. The agency reported receiving more than 1,500 comments in May on a March-published rule proposal intended to modify or introduce new regulations for event contracts. Reactions have been mixed: some state regulators pressed for stronger enforcement or tighter controls, while notable investors and industry participants—including venture firms—argued that federal regulation is essential to preserving market access and preventing a patchwork of state rules from undermining the sector’s integrity and liquidity.

In this climate, the CFTC’s no-action relief represents a tactical element of a broader federal strategy to codify a predictable regulatory baseline for prediction markets, even as jurisdictional debates persist across the states and the courts. The agency’s actions are being watched by market operators, financial institutions, and compliance teams for how future no-action letters may shape listing, clearing, licensing, and cross-border operations in a space that remains subject to evolving regulatory interpretation.

Operational implications for platforms and market participants

For prediction-market venues and their banking and clearing partners, the relief could lower the ongoing compliance overhead associated with swap-data reporting and recordkeeping. By differentiating event contracts from conventional swaps in practical reporting terms and pointing to futures-like treatment for listing and reporting, the CFTC signals a potential path to streamlined regulatory oversight without loosening safeguards around market integrity, transparency, or customer protection.

For operators like Kalshi, Polymarket US, and Gemini Titan, the development underscores the importance of clear regulatory delineations between federal derivatives law and state gambling statutes. The relief could influence licensing strategies, reporting frameworks, and the design of collateral requirements, all within the context of a broader push for consistent enforcement and improved market access across jurisdictions. The agency’s emphasis on prospective no-action letters suggests operators should anticipate further regulatory interactions as the rulemaking process unfolds and as states sharpen their policy positions on prediction markets.

From a compliance standpoint, firms should monitor the evolving guidance around what constitutes a reportable event, how event contracts should be classified for filing to swap-data repositories, and what documentation supports a no-action determination. The evolving posture of enforcement discretion—paired with ongoing litigation and rulemaking—implies that firms must maintain robust internal governance, particularly around data retention, event-logging, and cross-border operational risks that arise when state and federal authorities diverge in their regulatory expectations.

Closing perspective: The CFTC’s no-action relief for fully collateralized event contracts marks a deliberate attempt to balance market development with regulatory oversight. As federal and state authorities continue to navigate the jurisdictional questions surrounding prediction markets, market participants should prepare for evolving requirements, potential licensing changes, and continued policy debate that will influence how these platforms operate within the U.S. financial-legal framework.

Update May 14, 2:45 pm UTC: This article has been updated to include comments from Katie Haries, head of policy for Europe at Coinbase.

The Bank of England (BoE) is reconsidering parts of its proposed regime for pound sterling stablecoins after digital asset companies warned that holding caps and reserve requirements could stifle adoption and make UK-issued tokens uneconomic.

The central bank is looking at alternatives to temporary caps on how many stablecoins individuals and businesses can hold, and is examining whether its requirement that at least 40% of backing assets be held as non-interest-bearing deposits at the BoE is overly conservative, Deputy Governor Sarah Breeden told the Financial Times.

The rethink comes as the UK government and regulators try to position Britain as a competitive hub for digital assets while containing risks to bank funding and financial stability. Sterling-pegged tokens currently make up a tiny fraction of the roughly $300 billion global stablecoin market, which remains dominated by dollar-based issuers.

The BoE set out detailed ownership limits in its November 2025 consultation paper on a proposed regulatory regime for sterling-denominated systemic stablecoins, building on options first aired in a 2023 discussion paper.

Under that proposal, individuals would be restricted to holding up to 20,000 pounds (roughly $27,000) of a given UK stablecoin, while businesses would be capped at roughly $13.5 million, at least during an initial transition period.

Stablecoins Discussion Paper, 2023. Source: Bank of England

The central bank argued that limits were needed to avoid a sudden outflow of deposits from commercial banks into new forms of “tokenised” money if a large stablecoin were rapidly adopted for payments.

Related: Bank of England chief says global stablecoin rules will ‘wrestle’ with US

Industry groups and prospective issuers countered that the caps were operationally cumbersome, hard to supervise across platforms, and could deter serious institutional use of regulated UK stablecoins in areas like corporate treasury, payroll and settlement.

BoE rethinks stablecoin caps after pushback

Breeden has been one of the most cautious voices on stablecoins within the BoE. In November 2025, she warned that diluting the rules too far could damage financial stability, stressing that stablecoins are money-like instruments that must be at least as safe and robust as existing payments infrastructure.

At the time, she backed stringent liquidity requirements that would force stablecoin issuers to park large portions of their reserves at the central bank and hold the rest in high-quality liquid securities such as UK government bonds.

Law firms and potential issuers argue that such a structure would significantly compress margins and make UK stablecoin issuance far less attractive than operating under the United States or European Union regimes.

UK hunts for middle ground on stablecoins

The shift in tone highlights how UK policymakers are still feeling their way toward a middle ground on stablecoins as global approaches diverge.

In January, UK lawmakers opened an inquiry into how best to oversee fiat-backed tokens, taking evidence from industry participants such as Coinbase and Innovate Finance, while the BoE and Treasury continue to refine a framework intended to sit alongside broader crypto rules and potential digital pound plans.

Katie Haries, head of policy for Europe at Coinbase, told Cointelegraph it’s an important signal the BoE is prepared to revisit its stablecoin proposals.

“We’ve said for a long time that a cap on stablecoin holdings is a cap on innovation,” she said, with “real and significant risks for UK competitiveness.” She added that creating a regime where stablecoins can succeed and benefit users is “exactly the right ambition,” and something the crypto industry and everyday people are asking for.

A more flexible approach to caps and backing requirements could determine whether systemic GBP stablecoins emerge as serious competitors to dollar-pegged rivals in cross-border payments and onshore crypto markets, or whether activity remains concentrated in jurisdictions seen as more accommodating.

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Shares in Bitcoin-focused Strive closed 5.8% higher on Thursday after the company said it will become a “Daily Dividend Company” and revealed it eliminated all debt in the first quarter of 2026. 

The Vivek Ramaswamy-founded company said the Variable Rate Series A Perpetual Preferred Stock, ticker SATA, will start paying dividends every business day beginning June 16 at a current annual dividend rate of 13%. The payouts are funded by income generated from the company’s Bitcoin treasury strategy.

Strive CEO Matt Cole said the move will make it the first public company to offer daily dividends, expanding on a similar playbook adopted by Michael Saylor’s Strategy, which has relied on perpetual preferred stock offerings such as Stretch (STRC) to fund its Bitcoin purchases while paying investors every two weeks.

“The rate at which innovation is happening in the digital credit space is fascinating to behold,” said Bitcoin For Corporations contributor Adam Livingston. Strategy executive chairman Michael Saylor called the daily dividends “impressive.” 

Strive’s daily dividends mark another example of a Bitcoin treasury firm moving beyond a simple buy-and-hold strategy to remain competitive in the bear market.

This comes as Strive reported an unrealized net loss of $265.9 million for Q1. The company attributed the loss to a decrease in the fair market value of its Bitcoin holdings as Bitcoin fell 23% during the quarter. 

Source: Matt Cole

Strive is now operating debt-free

Strive said it ended the quarter with no outstanding debt after buying back the remainder of its long-term notes.

“Today, Strive stands debt-free, with zero margin requirements, and zero encumbered Bitcoin; a balance sheet purpose-built to thrive through Bitcoin volatility.”

Strive shares flip to positive year-to-date

Strive (ASST) shares rose 5.8% to $17.70 Thursday following the company’s earnings statement and gained another 0.73% in after-hours trading.

The company is now up 2.43% year to date but still down more than 81% over the past year.

Related: Bitcoin trades at a ‘discount’ on Coinbase: Is a $76K retest next? 

Strive ended Q1 with 13,628 Bitcoin, including 5,048 Bitcoin acquired through its purchase of Semler Scientific during the quarter. It has since added another 1,381 Bitcoin, bringing its total to 15,009 Bitcoin worth $1.22 billion at current prices.

On Wednesday, another Bitcoin company, Nakamoto, rose 2.7% after reporting that its revenue increased 500% quarter-on-quarter in Q1 to $2.7 million, with $1.1 million of that coming from a new strategy of using its Bitcoin holdings as collateral to earn yield.

Meanwhile, Q1 results from some of the larger players in the crypto industry were a mixed bag.

Stablecoin issuer Circle rallied 15% after reporting its revenue rose 20% quarter-on-quarter to $694 million, beating estimates, while crypto exchange Coinbase’s shares slid after it reported a steep first-quarter loss with a 21% fall in revenue to $1.4 billion. Robinhood also dipped 9.4% after its Q1 revenue also missed analyst expectations.

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The US Commodity Futures Trading Commission’s (CFTC) market and clearing divisions issued no-action relief for fully collateralized event contracts, easing certain swap data reporting and recordkeeping obligations for prediction market operators and clearing organizations.

The divisions said Wednesday that they will not recommend enforcement against designated contract markets (DCMs), derivatives clearing organizations (DCOs), or their participants for failing to comply with specified swap-related recordkeeping requirements or for failing to report covered transactions to swap data repositories.

Event contracts on prediction markets technically qualify as “swaps” as they are based on binary events. However, the letter argued that similar contracts are listed for trade by DCMs and have more similar characteristics to futures and options on futures, hence enabling firms to report certain events contracts directly to the CFTC.

The letter listed 19 platforms, including Polymaket, Kalshi and Gemini Titan. It added that companies seeking to list similar contracts may request a no-action letter from the CFTC.

The CFTC said the no-action letter comes in response to numerous requests from DCMs and DCOs that list and clear event contracts and said it anticipates more similar requests.

The move could reduce compliance complexity for CFTC-regulated prediction market venues, including Kalshi and Polymarket US as the agency continues to defend its jurisdiction against state gambling regulators.

The no-action letter comes as prediction markets sit at the center of a widening federal-state fight over whether sports and other event contracts should be regulated as derivatives by the CFTC or as gambling products by state authorities. The agency filed an amicus brief in the Sixth Circuit Court of Appeals on Tuesday, arguing that Ohio’s actions intrude on federally regulated markets after it ordered Kalshi to halt sports event contracts in the state last year.

Kalshi sued Ohio lawmakers in October 2025, requesting that the federal court stop the Ohio Casino Control Commission and state attorney general from taking action, but the motion was denied in court in March, leading Kalshi to appeal the decision. 

CFTC no-action letter on prediction markets. Source: CFTC.gov

CFTC pushes for exclusive jurisdiction over prediction markets

The CFTC has multiple ongoing disputes with state lawmakers over prediction market jurisdiction. It sued five states in a bid to cement its authority over prediction markets, including lawmakers in Wisconsin, New York, Arizona, Connecticut and Illinois. 

Earlier in May, the CFTC said it received over 1,500 responses on a rule it proposed in March that would allow it to amend or issue new regulations for event contracts on prediction markets. 

The responses were mixed, with some state regulators calling for a stricter crackdown on prediction markets, while others, such as venture capital firm a16z, sided with the CFTC, arguing that state crackdowns on these platforms conflict with federal law and damage market access for ordinary users.

Related: Kalshi, Polymarket face trading halt in Nevada after court rulings 

On March 12, the CFTC issued a staff advisory classifying event contracts on prediction markets as a “financial asset class,” Cointelegraph reported. 

Earlier in February, CFTC Chair Michael Selig publicly reiterated claims that the CFTC had “exclusive jurisdiction” over prediction markets. 

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TLDR:

• Kraken migrates kBTC and all future wrapped assets to Chainlink CCIP, citing enterprise-grade security.
• The $292M Kelp DAO exploit, tied to North Korea’s Lazarus Group, triggered a broad LayerZero exit across DeFi.
• Solv Protocol, Kelp DAO, and Re also left LayerZero for Chainlink CCIP following critical cross-chain security reviews.
• Kraken’s kBTC holds a $266M market cap; holders require no action as the backend migration proceeds.

Kraken has announced it will migrate its wrapped Bitcoin product, kBTC, from LayerZero to Chainlink’s Cross-Chain Interoperability Protocol (CCIP).

The move follows the $292 million Kelp DAO exploit in April, which was later linked to North Korea’s Lazarus Group. Kraken cited enterprise-grade security and strict risk management as the driving reasons.

The token holds a market cap of approximately $266 million, and future wrapped assets will also use Chainlink.

Kraken Moves Away From LayerZero Infrastructure

Kraken announced the deprecation of its LayerZero-based cross-chain provider this week. The crypto exchange will now use Chainlink CCIP as its exclusive cross-chain infrastructure.

The decision covers kBTC and all future Kraken Wrapped Assets. Holders of kBTC do not need to take any action at this time.

Kraken explained its reasons on X, formerly Twitter, in a public post. The exchange stated that Chainlink CCIP offers ISO 27001 and SOC 2 Type 2 certifications.

It also noted the protocol’s secure-by-default architecture and 16 independent nodes. Native rate limits were also listed among the key security features.

The exchange wrote: “Kraken is deprecating its existing cross-chain provider and migrating to Chainlink CCIP as its exclusive cross-chain infra.”

The post also referenced enterprise-grade infrastructure as a priority. Kraken confirmed that more details on the migration process will follow on official channels.

Kraken also noted a broader goal behind the migration. The exchange said both firms can help accelerate the global adoption of crypto.

By using CCIP, Kraken aims to unlock utility and distribution for its wrapped assets across DeFi. No specific timeline for the full migration was given.

LayerZero Fallout Spreads Across the Industry

Kraken joins a growing list of firms exiting LayerZero’s technology following the Kelp DAO incident. On April 18, attackers drained 116,500 rsETH liquid staking tokens from Kelp DAO’s infrastructure.

LayerZero later admitted it made a mistake in setting up Kelp DAO’s configuration. The Lazarus Group, a North Korean state-sponsored hacker group, was attributed to the exploit.

Kelp DAO was the first to announce it would move to Chainlink CCIP after the incident. Solv Protocol followed, saying it would migrate infrastructure backing over $700 million in Bitcoin-related assets.

On-chain reinsurance protocol Re also announced plans to leave LayerZero last week. Each departure has added to the scrutiny around cross-chain bridge security.

The Kelp DAO postmortem revealed that attackers poisoned internal RPCs used by LayerZero Labs. This allowed them to drain tokens without triggering standard security alerts.

The vulnerability was specific to how Kelp DAO’s setup was configured, according to LayerZero. However, the event prompted a wider review of cross-chain security practices across the industry.

Chainlink CCIP has emerged as the preferred alternative for firms reassessing their interoperability stack. Multiple protocols have now committed to the technology within weeks of the exploit.

The migration trend shows how a single security event can quickly shift infrastructure preferences in crypto. For Kraken, the move is part of a longer-term strategy to secure all its wrapped asset offerings.