STA conference puts prediction markets on market-structure agenda

The Securities Traders Association's 93rd Annual Market Structure Conference in Washington will include a prediction-markets panel bringing together participants from Kalshi, DraftKings and Robinhood. The Oct. 14-16 meeting at the JW Marriott Washington, D.C., is themed “The Future in Focus” and will examine changes in equities, options and exchange-traded funds.

Jim Toes, the association’s president and chief executive, said there was “a great deal of anticipation” around the panel. He said prediction markets had moved quickly into market-structure debate and that attendees wanted to understand how platforms fit within regulated trading and the broader oversight framework.

Prediction-market products are frequently called event contracts. The Commodity Futures Trading Commission says they are typically swaps whose value depends on an event outcome, often structured as yes-or-no contracts with a fixed payout, usually $1. Their prices reflect traders’ perceived probabilities, while regulated exchanges and brokers do not take a side of the trade.

The CFTC says it has regulated prediction markets since 2004 and oversees the sector through surveillance, supervision and enforcement. Federally regulated markets can operate in all 50 states, subject to rules intended to protect market integrity and prevent manipulation and insider trading. The panel follows the CFTC’s August advisory discussion of prediction-market policy, as covered in our Aug. 20 report.

DraftKings is among the panel’s participants. Its DraftKings Predictions product lets users trade contracts tied to sports and financial events; the company said it acts as a broker, sending customer orders to an exchange for execution. The product initially offered event contracts in 38 states and connected with multiple exchanges, beginning with CME Group.

The wider conference agenda includes tokenization, artificial intelligence, extended-hours trading and capital formation across public and private markets. A tokenization panel will include Securitize, DTCC and zerohash, focusing on what would be needed to move the technology from concept to broad adoption.

Jamie Selway, director of the Securities and Exchange Commission’s Division of Trading and Markets, is scheduled for a keynote interview. FINRA President and CEO Robert Cook will appear with Stephanie Dumont. The association’s August announcement projected more than 800 attendees from over 200 firms; more than 900 industry professionals were registered, including more than 30 chief executives and over 100 C-suite executives.

The programme also includes the 11th annual Women in Finance Symposium, the Dictum Meum Pactum Award ceremony and the first STA Young Professionals Forum. Toes said that greater clarity from regulators and legislators over the past year had shifted the market-structure conversation toward implementation, although he expected overnight trading to have the most immediate effect over the following year.