CME Group CEO Terry Duffy shed light on the company’s potential foray into sports event contracts during its Q3 2025 earnings call.

If the federal government ultimately gives the nod for prediction markets to continue offering sports contracts, CME will be happy to partake, Duffy told analysts on Wednesday.

“CME Group is not opposed, not opposed to listing sports events on our contracts, on our DCM (Designated Contract Market),” Duffy said. “What is critically important is the federal government has to make certain that they approve these contracts. I won’t sit on the sidelines.”

While sports was not mentioned when CME Group announced in August a joint venture with FanDuel, Bloomberg News reported last week that CME is “planning to debut financial contracts tied to both sports games and economic indicators by the end of the year.”

Per Duffy, the Bloomberg article, titled “CME Plans to Launch Sports Contracts to Compete With Kalshi”, didn’t break much ground, as he has maintained from the jump that CME is interested in sports.

“Headlines can be very deceiving,” Duffy clarified. ”… I have said numerous times on podcasts, publicly on television, to you, to others, that my partner at FanDuel, when they are prepared to move forward with events on sports, I would be prepared on day one in order to offer that to them on my DCM.” 

The caveat? The government must sign off.

“As long as the U.S. government is not going to object to the self-certification of these and consider these swaps and not gaming, it doesn’t matter what my opinion or anybody else’s.

“That’s the government’s opinion, and we will proceed accordingly. That is yet to be decided.”

Much of the talk around prediction markets’ disruption of the sports betting industry has been about parlays, a massive profit driver for sportsbooks and products that traditional sports betting operators believe give them a major advantage over the upstarts. Kalshi, though, has been slowly rolling out “combination” trades.

For financial exchanges to offer an event contract, there must be an economic consequence tied to the event. Event contracts are designed as hedges against certain economic conditions.

That’s the legal rationale, anyway.

While some have a hard time buying the argument that the Broncos beating the Cowboys by 3.5 points on Sunday is really an economic hedge, the case that a parlay can be an economic hedge is even more difficult to make.

Duffy said CME is not considering getting into parlays, for both operational and regulatory reasons.

“A swap is categorized or defined as something that’s commercially or economically beneficial,” he explained. “When you start getting into parlays on prediction on sports, I think sometimes you might be crossing that line.

“Is this legitimate or not? Is this a sports gambling contract, or is this an economically beneficial and has the exposure for the client that is commercially concerning, which is the definition of a swap contract today? It has to have an economic benefit to it.”

The CFTC could weigh in on prediction markets offering parlays once the government shutdown ends, Duffy noted.

Duffy participated in – in fact, kind of starred in – last month’s SEC/CFTC joint roundtable on regulatory harmonization that also featured Kalshi’s Tarek Mansour and Polymarket’s Shayne Coplan.

While Duffy pushed back on the different treatment prediction markets and traditional exchanges receive from the CFTC and SEC, respectively, he made it clear that he’s “massively excited” about the future and participating in new asset classes.

“I just did the deal with FanDuel, as you know, I’m all in on this stuff,” Duffy said then.

On CME’s earnings call, he reiterated, “The announcement with FanDuel is very important for CME Group. We’re looking at 13 million potential accounts that will have access to CME Group’s products, but more importantly, have access to have a view of CME Group and our distribution of our product lines for the future.”

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