that “ may involve” one of the prohibited categories under § 40.11(a)(1). It in no way requires a 90-day review for event contracts that do involve such prohibited categories, like Kalshi’s sports event contracts. The same is true of the Special Rule, which merely requires the CFTC to make a public interest determination “no later than 90 days” from when it commences a review—something the CFTC did long-ago when promulgating its categorical determination in § 40.11(a)(1). See 7 U.S.C. §§ 7a-2(c)(5)(C)(i)–(ii), (iv). The CFTC acted consistently with Congress’s intent that the Special Rule prevent the usage of event contracts “to enable gambling”—particularly including sports betting. In fact, in a colloquy between Senator Lincoln—one of the principal architects of the Special Rule—and Senator Feinstein, Senator Lincoln explained: [It] is our intent . . . [that the Special Rule] prevent derivatives contracts that are contrary to the public interest because they exist predominantly to enable gambling through supposed “event contracts.” It would be quite easy to construct an “event contract” around sporting events, such as the Super Bowl, the Kentucky Derby, and Masters Golf Tournament. These types of contracts would not serve any real commercial purpose. Rather, they would be used solely for gambling. 156 Cong. Rec. S5906–7 (2010). Because Kalshi’s sports event contracts involve both gaming and activity that is unlawful under state and federal law, they expressly violate 17 C.F.R.
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