The Commodity Futures Trading Commission headquarters in Washington. Photographer: Daniel Heuer/Bloomberg

Prediction market wagers involving bets on what high-profile people might say in public present heightened manipulation risk and can only be offered in limited circumstances, Commodity Futures Trading Commission staff warned in new guidance. The advisory is the regulator’s latest attempt to reel in the exploding industry after it floated a proposal in June to crack down on bets related to war and terrorism.

The new guidance, which doesn’t carry the weight of an agency rule, applies to a niche corner of prediction markets, where users can place yes-or-no trades on future events like sports and politics. The bets on so-called mention markets involve trading on words or phrases people might say in speeches, earnings calls or post-game press conferences.