Sleeper accuses CFTC of “illegal delay” to prediction markets application

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Sleeper Markets LLC, the entity operator of the popular fantasy sports app Sleeper, has publicly accused the U.S. Commodity Futures Trading Commission (CFTC) of an “illegal delay” on its application to register as a Futures Commission Merchant (FCM).

Sleeper Markets LLC, the entity operator of the favored fantasy sports activities app Sleeper, has publicly accused the U.S. Commodity Futures Buying and selling Fee (CFTC) of an “unlawful delay” on its utility to register as a Futures Fee Service provider (FCM).

This registration is a vital regulatory requirement for Sleeper to legally facilitate buyer trades, together with prediction markets tied to sports activities betting and different occasions.

The present Trump regime has been extra receptive to prediction markets, as evidenced by the relaunch of PredictIt in the United States, with it being a fully-fledged and accredited platform.

As for Sleeper, which has hundreds of thousands of customers on its day by day fantasy sports activities platform, it needs to increase into regulated prediction markets throughout sports activities, elections, and even the climate.

To do that, it should register as an FCM with the CFTC and turn into a member of the Nationwide Futures Affiliation (NFA), the self-regulatory physique for the derivatives business.

FCMs act because the intermediary, dealing with buyer orders, margins, and clearing for futures contracts.

Sleeper submitted its FCM utility in early 2025, and after evaluation in August, it appeared the statutory and regulatory necessities had been met.

CFTC thought in any other case, and workers intervened on the eleventh hour, apparently instructing the NFA to withhold approval pending an additional evaluation. The explanations for this have been obscure, with no clear clarification offered.

In consequence, Sleeper’s attorneys on the regulation agency, Milbank, issued a scathing letter to the CFTC’s Office of the Inspector Normal, citing the delay as a blatant violation of federal regulation.

Get your popcorn out.

Attorneys for the fantasy sports activities app Sleeper wrote a letter to the Workplace of the Inspector Normal calling out the Commodity Futures Buying and selling Fee for “violating the regulation” in coping with Sleeper’s try and enter prediction markets. pic.twitter.com/LzitfdeCtj

— Dustin Gouker (@DustinGouker) September 15, 2025

Sleeper calls out CFTC for “violating the regulation”

As a part of the letter, titled “Abuse, Mismanagement, and Waste by the CFTC below its Appearing Chairman and Sole Commissioner,” the claims embody:

The CFTC’s maintain lacks any authorized foundation, because the CEA mandates computerized registration upon NFA approval except there’s proof of health points.
The delay stems from “unspecified considerations” about occasion contracts on unaffiliated Designated Contract Markets (DCMs).
Appearing Chairman and sole Commissioner Kristin Johnson is conscious of or directing the misconduct, doubtlessly as a part of broader CFTC efforts to scrutinize prediction markets amid ongoing litigation.

This motion towards Sleeper doesn’t come as an excessive amount of of a shock, given current strikes from the CFTC towards prediction markets. A few of these have been very aggressive, like when the Commission sued Kalshi over election betting contracts.

The subsequent step on this case can be an attention-grabbing one, with the CFTC but to reply publicly.

As beforehand suggests, the Trump administration has been appearing favorably towards the prediction markets, and it exhibits that we’re nonetheless a way off from the absence of regulatory bottlenecks proper throughout the sector.

Picture credit score: SleeperMarkets

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