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00:02The Commodity Futures Trading Commission warned Tuesday that prediction market mention contracts
00:08face a heightened risk of manipulation, according to CNBC.
00:12The agency said these contracts can be vulnerable because settlement may depend on a person's
00:16conduct that is neither independently generated nor externally verifiable.
00:21Mention markets allow traders to bet on specific words used in speeches, earnings calls, or
00:27television broadcasts.
00:28The CFTC said its advisory creates no new obligations but outlines when the contracts
00:34may be listed under the Commodity Exchange Act.
00:37Exchanges should consider outside obligations or pressure affecting a subject, whether settlement
00:41events can be independently verified, and whether adequate safeguards exist to detect manipulation.
00:47The CFTC encouraged exchanges to consult its market oversight division early when designing
00:52mentioned market contracts to help reduce manipulation risks.
00:55For all things money, visit Benzinga.com.
