Michael Selig, nominated by President Donald Trump to chair the Commodity Futures Trading Commission (CFTC), appeared for his confirmation hearing before the Senate Agriculture Committee on Capitol Hill on November 19, 2025.
The Commodity Futures Trading Commission has taken a definitive step to affirm its jurisdiction over prediction markets, filing an amicus brief in federal court against state-level regulation efforts. The action, announced by Michael Selig, the newly appointed chairman, underscores the agency's commitment to overseeing prediction markets across the United States.
In an opinion piece published in the Wall Street Journal, Selig insisted that the CFTC has long held the authority to regulate prediction markets and to delineate whether event contracts should be classified as gambling—a claim made by many critics. He highlighted that nearly 50 legal cases challenge prediction markets, urging the CFTC to act to prevent states from overstepping their authority.
"The CFTC will no longer sit idly by while overzealous state governments undermine the agency's exclusive jurisdiction over these markets by seeking to establish statewide prohibitions on these exciting products," Selig expressed in his article.
This initiative is set against a backdrop of legal disputes facing platforms like Kalshi and Polymarket over event contracts, which enable users to speculate on outcomes in various sectors such as pop culture, sports, and entertainment.
Critics equate these prediction markets to gambling, while supporters like Kalshi argue their compliance with federal regulations. The resemblance of these activities to legalized sports betting has sparked further debate.
In his initial public comments as chairman at the end of January, Selig conveyed his readiness to draft precise regulations for governing these markets and to revisit the agency's protocols concerning its involvement in court cases.
"Where jurisdictional questions are at issue, the Commission has the expertise and responsibility to defend its exclusive jurisdiction over commodity derivatives," he stated earlier.
Selig's op-ed also argued that event contracts provide "legitimate economic functions" and operate under CFTC regulations as "swaps" rather than games of chance. He further stated that such trading is advantageous for both the market and American citizens.
"These exchanges aren't the Wild West, as some critics claim, but self-regulatory organizations that are examined and supervised by experienced CFTC staff," he noted.
In a video shared on platform X, Selig conveyed a resolute message toward those questioning the CFTC's authority: "We will see you in court."
"Today, the CFTC is taking an important step to ensure these markets have a place here in America and possess the integrity, resilience, and vibrancy that our derivative markets deserve," Selig stated.
The amicus brief is planned to be filed in the Ninth U.S. Circuit Court of Appeals, supporting Crypto.com in its legal contention with the Nevada Gaming Control Board. However, CNBC has not confirmed whether this brief has indeed been submitted.
Disclosure: CNBC and Kalshi have a commercial relationship, which includes a CNBC minority investment.