A16z Backs CFTC, Warns State-Level Prediction Market Rules Create Market Access Barriers

According to The Block, Andreessen Horowitz submitted an 18-page comment letter to the Commodity Futures Trading Commission on Friday, supporting federal oversight of prediction markets and opposing state-level crackdowns. A16z argued that cease-and-desist letters and proposed bans from state regulators create a “serious barrier to impartial access” for users and would “severely circumscribe available liquidity” by forcing exchanges to block users based on their state of residence. The firm noted that blockchain-based prediction markets offer unique price discovery mechanisms and greater transparency than traditional platforms. Polymarket and Kalshi, the leading prediction market platforms, saw their combined lifetime trading volumes cross $150 billion in April.