The CFTC issued an order on April 2 prohibiting the North American Derivatives Exchange (Nadex) from listing or making available for clearing or trading a set of self-certified political event contracts. The contracts are binary option contracts that pay out based on the results of this year’s elections.
Nadex self-certified the contracts on December 19, 2011. The CFTC initiated a 90-day review period of the contracts on January 3, 2012. As a result of the findings, the CFTC determined that the contracts involve gaining and do not advance the public interest. The contracts cannot be listed, be cleared or traded.
In a separate letter, the CFTC requested that Nadex withdraw its self-certification of related rule amendments that were submitted by Nadex to enable trading the contracts.
