CFTC calls on exchanges to lift geographic restrictions

In a statement on November 5, the CFTC asked designated contract markets under federal oversight to remove internal geographic restrictions that conflict with fair access requirements within 30 days. According to the agency, if it cannot do so, it must explain the reason to the Market Oversight Division. The CFTC argues that regional divisions can weaken liquidity and cites regionally popular sports contracts as an example. The scope of the guidance also extends to intermediaries that route customers to exchanges.

A day earlier, on November 4, Judge Jacqueline Scott Corley of the U.S. District Court for the Northern District of California barred Kalshi from offering sports contracts on the Indian lands of the plaintiff tribes. The ban also covers esports and chess. The first step falls to the tribes, which must provide Kalshi with maps of their territorial boundaries by November 13, 2026. Kalshi, for its part, must file an updated status report with the court within 21 days showing its steps to comply with the ruling.

The CFTC also highlights the risks of certain positions. An investor in a restricted area cannot manage a position or respond to a margin call. Forced liquidations may affect intermediaries and clearing organizations. The agency also warned that if investors in restricted areas cannot buy or sell the relevant contracts, temporary price gaps may persist.

State licensing, however, is moving in a different direction. In a letter dated November 13, 2025, Dean Serpa, Executive Director of the Massachusetts Gaming Commission, wrote to all sports wagering licensees, prohibiting them from offering sports event contracts in Massachusetts. The letter states that a license may be revoked. This letter was written before the CFTC's comment. If the exchanges cannot reconcile the two regulations, they will have to state this clearly in their response to the CFTC. Kalshi has operated as a designated contract market since 2020. A company spokesperson said the firm is reviewing the new guidance.