Earlier this week, Suzanne Cosgrove wrote about the Commodity Futures Trading
Commission's decision to prohibit Congressional Control
Contracts, which it described as "cash-settled, binary
(yes/no) contracts based on the question: “Will be controlled by for
?” The CFTC disapproved of Congressional Control
Contracts on the basis that they involve "gaming". While
neither the Commodity Exchange Act nor the CFTC's regulations
define "gaming", the CFTC concluded that Congressional
Control Contracts involve "gaming" because "taking a
position in the Congressional Control Contracts would be staking
something of value upon the outcome of a contest of
others".
Some especially mnemonistic readers will recall this
blog post from a decade ago discussing the
overlap among wagering, insurance, bucketing and the securities
laws.
