Gensler Files Brief Against CFTC, Argues Sports Contracts Are Not Swaps Under Dodd-Frank

Former CFTC and SEC Chair Gary Gensler filed an amicus brief with the Sixth Circuit this week arguing that sports event contracts do not qualify as swaps under federal commodities law, directly challenging the CFTC's legal theory. The filing coincided with the CFTC suing New Mexico over prediction-market regulation, marking the eighth state the agency has sued over jurisdiction.

Gensler argued in his brief that Congress did not include sports betting contracts in the 2010 Dodd-Frank Act's definition of swaps, which focus on hedging economic risk. "Sports bets are very rarely, if ever, about hedging," Gensler stated. The intervention represents a rare public break from a former agency head against the sitting CFTC's central legal theory and could undermine the CFTC's claim to exclusive jurisdiction over prediction markets.