Leaning that way. The order "presumptively believes the certification is false," noting ProphetX identified no "financial, economic, or commercial consequence" tied to a scorigami. It leaves open whether any NFL scoring contract, or a scorigami one, could be a swap.

The ProphetX scorigami order stays the listing during a CFTC review and "makes no final determination." The issue is whether the contracts are swaps at all. ProphetX has until Nov. 18 to answer. A 1905 Supreme Court case weighed a related question: frameworkfaults.substack.com…

The CFTC has stayed ProphetX's NFL "scorigami" contracts, which pay out if a game ends in a never-before-seen score. Its question: is a scorigami tied to a "financial, economic, or commercial consequence"? In 1905, the Supreme Court weighed a related one: frameworkfaults.substack.com…

Dodd's brief is about Dodd-Frank, but the "bucket shops" language in the CEA is older. It entered the Act in 1992, borrowing a term from the exchanges' turn-of-the-century war on shops that let people bet on prices. The history: frameworkfaults.substack.com…

New Jersey officials have asked the Supreme Court to take up the question in Flaherty v. KalshiEX. Kalshi's response is due Nov. 9. How a clause written for swaps became the battleground over sports event contracts: frameworkfaults.substack.com…

The odder part is a phrase. "Bucket shops" is still in federal commodities law, but it wasn't put there to stop gamblers. Congress inserted it in 1992 to protect Wall Street's swaps. Now a federal appeals court has turned that clause against the exchanges.

The 1974 law giving the CFTC "exclusive jurisdiction" over futures trading also says "nothing in this section shall supersede or limit the jurisdiction conferred on courts of the United States or any State." The dispute over those two sentences has split the appeals courts

On Jan. 24, 2025, Kalshi began listing sports contracts it had self-certified. The CFTC neither reviewed nor blocked them. On March 27, New Jersey's gaming regulator sent a cease-and-desist letter calling them "unauthorized sports wagers." Deadline: 11:59 p.m. the next day.

The shops' defense in that case is the best part: they argued the Board "itself keeps the greatest of bucket shops," because most pit trades never delivered grain. Holmes answered that "Set-off has all the effects of delivery." More here: frameworkfaults.substack.com…

In Flaherty v. KalshiEX, New Jersey officials want the Court to take up whether federal commodities law stops states from enforcing gambling laws against Kalshi's sports contracts. Kalshi's response is due Nov. 9. When is a contract on the future a bet? frameworkfaults.substack.com…

Sued by the Chicago Board of Trade, the shops argued that the Board "itself keeps the greatest of bucket shops," since most pit trades settled with no grain delivered. In 1905 the Supreme Court sided with the Board, 6 to 3. Holmes: "Set-off has all the effects of delivery."

Bucket shops took bets, usually $10 to $50, on whether a stock or a bushel of wheat would rise or fall. They used the exchange's quotations as the scoreboard and never traded on it. "A customer's winnings were a bucket shop's losses," historian David Hochfelder writes.

"Bucket shops" is still in the U.S. Code. The Commodity Exchange Act's preemption section, 7 U.S.C. § 16(e)(2), names state laws on "gaming or the operation of bucket shops." It dates to a Gilded Age fight over a question New Jersey is asking the Supreme Court to take up.

In 1887 the Chicago Board of Trade's president had basement cables cut with an axe, thinking they were telegraph lines. They ran to the police and fire departments. His real target was the bucket shops. The term is still in federal commodities law. frameworkfaults.substack.com…

Part 3 is now live. This is where temporary power becomes selective enforcement. Targeting, conditioning to obey, and the blending of legal mechanisms with private agendas. Not in theory, but in form. Read the conclusion: open.substack.com/pub/framew…

The crisis ends. The structure doesn’t. Institutions evolve to enforce without oversight. Read Part 2 here: open.substack.com/pub/framew… Part 3 drops Sunday: enforcement, targeting, and noncompliance.

How War Powers, Emergency Declarations, and Crisis Legislation created a permanent exception. This is how it begins.

They don’t need your belief, only your obedience. This 3-part series exposes how crisis is used to build permanent power. Part 1 is free. Start here. open.substack.com/pub/framew…