Guide

Glossary

The terms you’ll meet in prediction market cases, rules and filings, defined from the sources.

Reviewed Oct. 22, 2026 · Live figures update with our records · Sources are footnoted

Event contract: a derivative, usually with a yes/no (binary) payoff, based on whether a specified event or occurrence happens.¹
Designated contract market (DCM): an exchange (board of trade) that operates under CFTC oversight.²
Derivatives clearing organization (DCO): a clearinghouse that stands between the two sides of a trade, substituting its own credit for theirs.³
Futures commission merchant (FCM): a firm that takes customer orders for futures and accepts money or property to margin or secure those trades.⁴
Introducing broker (IB): a firm that solicits or accepts futures orders but does not accept customer money or property to margin those trades.⁴
Self-certification: an exchange lists a new contract by certifying to the CFTC in writing that it complies with the CEA and CFTC rules.⁵
Special rule: CEA section 5c(c)(5)(C), the provision letting the CFTC bar event contracts involving listed categories such as gaming, war or terrorism.⁵
Preemption: when federal law displaces state law; courts treat implied preemption as either field preemption or conflict preemption.⁶
Swap: under the CEA, includes a transaction whose payment depends on whether an event or contingency occurs that is associated with a potential financial, economic or commercial consequence.⁷
Cert petition: a request asking the U.S. Supreme Court to review a lower-court judgment; review is discretionary, not a right.⁸ The Supreme Court grants and hears argument in only about 1% of the cases filed each Term.⁸
Preliminary injunction: an order issued before final judgment, available only if the requesting party shows it is likely to win, likely to suffer irreparable harm, and that relief is equitable and in the public interest.⁷
En banc: all authorized judges of an appeals court hearing a case together, instead of the usual three-judge panel.⁹
Remand: an appeals court sends a case back to the court or agency it came from.⁹
Cease-and-desist order: an order directing a party to stop specified conduct; the CFTC's 2022 Polymarket order, for example, required it to stop violating the CEA.¹⁰
No-action letter: a written statement by CFTC division staff that they will not recommend enforcement for specified noncompliance; it binds only the staff that issued it.¹¹