CFTC Regulation 40.2(a) Notification Regarding the Initial Listing of the “Will McLaren’s margin of victory at the 2026 United States Grand Prix be <above/below/exactly/at least/at most/between> <time>?" Contract
KalshiEX LLC · received by the CFTC 14 October 2026 · the filing (PDF)
Summary
Warrant Check read 5 operative provisions in this filing. Across them, 8 of 30 checks are present, 3 partial and 19 absent. 1 provision has every check present. 1 rule on who may trade is not a settlement term and is left out.
8 present3 partial19 absentWhat the wording addresses
- Payout Criterion / Market Outcome determination — every check present.
“McLaren won the 2026 United States Grand Prix” - Material error / data correction determination: Comprehensive Coverage, Relevant Timeline.
“determines, in its sole discretion, that the correction remedies”
What the wording leaves open
- Market Outcome Review Process (Rule 7.1) “resolved by Kalshi pursuant to Rule 7.1”
- Independent Verification — Absent: No external evidence named; resolution is internal to Kalshi via a process whose content is not in the supplied text.
- Suitable Method — Absent: No procedure is described in the supplied text capable of establishing the claim; it is deferred entirely to an unseen rule.
- Defined Benchmark — Absent: No threshold or criteria are given here; the standard is said to live in Rule 7.1, which is not provided.
- Conclusive Link — Absent: no named standard - entailment cannot be assessed
- Comprehensive Coverage — Absent: Coverage of the review process (what disputes/data gaps it applies to) is not defined in the supplied text.
- Relevant Timeline — Absent: No time bounds for the review process are specified in the supplied text.
- Relies on material referred to but not in the public filing.
- Material error / data correction determination “determines, in its sole discretion, that the correction remedies”
- Independent Verification — Absent: Determination rests on the Exchange's own sole discretion, not on a named neutral instrument or third-party certification.
- Suitable Method — Absent: 'Sole discretion' is not a checkable procedure capable of establishing the presence of a material error at any defined strength.
- Defined Benchmark — Partial: Some illustrative criteria are given (wrong driver/car, manifestly inconsistent with timing) but qualified by 'may be treated as', leaving the threshold elastic.
- Conclusive Link — Partial: Even if the illustrative criteria are met, the Exchange's discretion still governs whether this counts as a material error.
- Race disruption / no-data fallback to last fair price “resolve to the last fair price, as determined”
- Independent Verification — Absent: The operative fallback price is set by Exchange sole discretion, not by any named receivable evidence or instrument.
- Suitable Method — Absent: No procedure or methodology is given for deriving a 'fair price'; sole discretion cannot establish a checkable value.
- Defined Benchmark — Absent: 'Last fair price' is not defined by any threshold, formula, or reference source.
- Conclusive Link — Absent: no named standard - entailment cannot be assessed
- Comprehensive Coverage — Absent: No population or data set is specified from which the 'fair price' is drawn.
- Relevant Timeline — Absent: No defined time window for the fair-price determination is specified beyond the triggering conditions.
- Death / act of violence or terrorism contingency “Kalshi may, in its sole discretion, settle the Contract”
- Independent Verification — Absent: Determinations rest on Kalshi 'reasonably believes' and 'sole discretion'; no named neutral evidence source is specified.
- Suitable Method — Absent: No procedure is given capable of establishing death, the act, or 'material effect on trading' at any defined certainty.
- Defined Benchmark — Absent: No objective threshold for 'materially affected' trading or for an 'act of terrorism' is named.
- Conclusive Link — Absent: no named standard - entailment cannot be assessed
- Comprehensive Coverage — Absent: No defined population of trading activity or time window is specified for assessing 'material effect'.
- Relevant Timeline — Partial: Tied loosely to 'prior to the death or act' but allows use of an 'approximate time' where precise timing is unknown.
Every provision read
Payout Criterion / Market Outcome determination
“McLaren won the 2026 United States Grand Prix”
Determination: McLaren won the race and the margin of victory stands in the stated relation to <time> · Consequence: Market Outcome is set to Yes or No and long/short position holders are paid accordingly
Present Independent Verification. Relies on the FIA's published Final Race Classification, an official third-party document, with Formula1.com/media as fallback.
Present Suitable Method. A published classification with time gaps to the thousandth of a second can establish both the winner and the exact margin asserted.
Present Defined Benchmark. The named standard is the FIA's 'initial, non-preliminary' Final Race Classification, with defined rules for penalties, laps-down drivers, and dead heats.
Present Conclusive Link. Meeting the classification standard (as defined, including penalties applied) directly establishes winner and margin as the contract defines them.
Present Comprehensive Coverage. The classification covers the entire field of the single named race, matching the claim's scope exactly.
Present Relevant Timeline. The classification is tied to the specific race and Expiration Date/time; post-Expiration revisions are expressly excluded.
Market Outcome Review Process (Rule 7.1)
“resolved by Kalshi pursuant to Rule 7.1”
Determination: that continuing ambiguity/dispute exists among Source Agencies, or that the Expiration Value cannot be determined · Consequence: Kalshi resolves the outcome or determines payouts through the Market Outcome Review Process
Absent Independent Verification. No external evidence named; resolution is internal to Kalshi via a process whose content is not in the supplied text.
Absent Suitable Method. No procedure is described in the supplied text capable of establishing the claim; it is deferred entirely to an unseen rule.
Absent Defined Benchmark. No threshold or criteria are given here; the standard is said to live in Rule 7.1, which is not provided.
Absent Conclusive Link. no named standard - entailment cannot be assessed
Absent Comprehensive Coverage. Coverage of the review process (what disputes/data gaps it applies to) is not defined in the supplied text.
Absent Relevant Timeline. No time bounds for the review process are specified in the supplied text.
Material error / data correction determination
“determines, in its sole discretion, that the correction remedies”
Determination: that a subsequently corrected, retracted, or removed value remedies a 'material error' in the initial published value · Consequence: corrected value governs instead of the initial value, or Expiration may be delayed
Absent Independent Verification. Determination rests on the Exchange's own sole discretion, not on a named neutral instrument or third-party certification.
Absent Suitable Method. 'Sole discretion' is not a checkable procedure capable of establishing the presence of a material error at any defined strength.
Partial Defined Benchmark. Some illustrative criteria are given (wrong driver/car, manifestly inconsistent with timing) but qualified by 'may be treated as', leaving the threshold elastic.
Partial Conclusive Link. Even if the illustrative criteria are met, the Exchange's discretion still governs whether this counts as a material error.
Present Comprehensive Coverage. The determination is tied to the specific published value/classification at issue, matching the claim's scope.
Present Relevant Timeline. Correction must occur 'prior to Expiration'; post-Expiration corrections are expressly excluded, matching the obligation period.
Race disruption / no-data fallback to last fair price
“resolve to the last fair price, as determined”
Determination: that the race was cancelled, did not start within 48 hours, produced no Final Race Classification, no points were awarded, or no data was published · Consequence: Contract resolves to the 'last fair price' as determined by the Exchange in its sole discretion
Absent Independent Verification. The operative fallback price is set by Exchange sole discretion, not by any named receivable evidence or instrument.
Absent Suitable Method. No procedure or methodology is given for deriving a 'fair price'; sole discretion cannot establish a checkable value.
Absent Defined Benchmark. 'Last fair price' is not defined by any threshold, formula, or reference source.
Absent Conclusive Link. no named standard - entailment cannot be assessed
Absent Comprehensive Coverage. No population or data set is specified from which the 'fair price' is drawn.
Absent Relevant Timeline. No defined time window for the fair-price determination is specified beyond the triggering conditions.
Death / act of violence or terrorism contingency
“Kalshi may, in its sole discretion, settle the Contract”
Determination: that a relevant person died, or an act of violence/terrorism directly affected the event, and whether trading was materially affected · Consequence: Contract is settled at a last-traded price (or ORC-determined price), trading may be halted, and determinations are final and unreviewable
Absent Independent Verification. Determinations rest on Kalshi 'reasonably believes' and 'sole discretion'; no named neutral evidence source is specified.
Absent Suitable Method. No procedure is given capable of establishing death, the act, or 'material effect on trading' at any defined certainty.
Absent Defined Benchmark. No objective threshold for 'materially affected' trading or for an 'act of terrorism' is named.
Absent Conclusive Link. no named standard - entailment cannot be assessed
Absent Comprehensive Coverage. No defined population of trading activity or time window is specified for assessing 'material effect'.
Partial Relevant Timeline. Tied loosely to 'prior to the death or act' but allows use of an 'approximate time' where precise timing is unknown.
Read 31 October 2026 with Warrant Check (instrument 1.0). Labels: Present, Partial, Absent describe whether each check is found in the wording as written.