Why prediction markets still lack durable leverage: liquidation is not a guarantee of execution. In an $0.80 contract at 5x, the next bid can sit at $0.35 long before the margin call fills, so lenders cannot rely on timely exits. Eniola surveys collateralized lending, margin trading, event perpetuals and short-epoch financing before landing on insurance-style risk pricing, where Lattica's WARHORSE engine sets a premium against each position's jump risk.

Two appeals courts held in August and September 2026 that Kalshi's sports event contracts are not swaps. On 9 October the CFTC answered with a pair of rules: an interim final rule excluding casino-style gambling from the swap definition by licence and execution model, and a proposal adding event contracts back in. The piece notes the Ninth Circuit granted preemption and still lost on the product, and argues classification now resolves contract by contract, not firm by firm.

On 24 September 2026 the New York Attorney General filed a verified petition against QCX LLC, which trades as Polymarket US, pleading eight predicates of illegality under Executive Law § 63(12) drawn from the state Constitution, the Penal Law, the Racing Law and the federal Wire Act. Prokopiev reads the counts one by one and finds the Penal Law predicates strongest, because a $3.01 stake on the Mets fits the statutory definition of gambling on its face — the contested element is 'unlawful', which New York defines as 'not specifically authorized by law', leaving Polymarket to argue that a CFTC designation and an unreviewed self-certification supply that authorization. Preemption therefore decides the case, and the circuits are split: the Third Circuit treated self-certified sports contracts as swaps within the CFTC's exclusive jurisdiction and 'presumptively approved', while the Ninth Circuit held they are not swaps and that Rule 40.11 still bars gaming contracts, and the district court closest to this forum rejected preemption outright. On the authority available in September 2026 a New York court is more likely to reject preemption than accept it, and the author also flags what the petition overreaches on: a Racing Law penalty capped at $5 million that the prayer ignores, a treble-gain fine that has no civil vehicle in a § 63(12) proceeding, and restitution language broad enough to pay winning traders too.

A Bocconi law professor reads the transatlantic puzzle at the centre of prediction market regulation: US appeals courts are split on whether event contracts are federally regulated derivatives or state-regulated wagers, with the Third Circuit accepting CFTC jurisdiction in April and the Ninth Circuit rejecting it on August 28. Annunziata shows that EU law already lands where the Ninth Circuit landed, treating a contract on a discrete fact like who wins a match as a wager rather than a financial instrument, which is why Belgium, France, Italy, Poland and Romania have blocked access to the platforms. The classification question is a choice between protecting retail savers and letting them speculate, and it is now before the Supreme Court and the European Commission.

Compares how the US, UK, EU, and Japan built regulatory pathways for prediction markets while Asian jurisdictions have none. Estimates South Korea forgoes up to $43M in annual tax revenue as $52M flows through offshore platforms into its election markets, and lays out three paths forward: gambling law, derivatives law, or a new third category.

An academic paper that examines cryptocurrency prediction markets through the lens of derivatives pricing, using trade data from Kalshi and Polymarket. Treats event contracts as option-like claims and analyzes their prices for variance risk premia, volatility patterns, and skewness — asking how much of a prediction market price reflects a probability forecast versus compensation for risk. Offers a framework for reading crypto prediction market prices as derivatives quotes rather than pure consensus estimates.