Trump admin moves to block states regulating prediction markets
“In response, the CFTC has today filed a friend of the court brief to defend its exclusive jurisdiction over these derivative markets.”
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“In response, the CFTC has today filed a friend of the court brief to defend its exclusive jurisdiction over these derivative markets.”
The Trump administration's Commodity Futures Trading Commission (CFTC) on Tuesday moved to block states from imposing regulations in betting markets, with CFTC Chairman Mike Selig saying that the CFTC will take states “to court” if they impose regulations.
“Over the past year, American prediction markets have been hit with an onslaught of state-led litigation. In response, the CFTC has today filed a friend of the court brief to defend its exclusive jurisdiction over these derivative markets,” Selig said.
https://twitter.com/ChairmanSelig/status/2023744651216240966?s=20
“Prediction markets aren't new. The CFTC has regulated these markets for over two decades. They provide useful functions for society by allowing everyday Americans to hedge commercial risks like increases in temperature and energy price spikes, they also serve as an important check on our news media and our information streams. Today, the CFTC is taking an important step to ensure that these markets have a place here in America and have the integrity and resilience and vibrancy that our derivatives markets deserve. To those who seek to challenge our authority in this space, let me be clear, we will see you in court,” he added.
Selig did not mention sports betting in the list of examples; however, that is where many states have launched legal disputes concerning betting markets. According to CoinDesk, multiple states have filed legal disputes with organizations that facilitate sports betting, including Nevada, Massachusetts, and New York.
Although Selig said that the CFTC has the "exclusive jurisdiction over these derivative markets,” the agency had usually gone after betting market companies before Trump was elected.
The CFTC's legal fight with Kalshi, for example, was abandoned after the Trump administration came into office. Donald Trump Jr is also a strategic advisor for Kalshi, and he joined Polymarket’s advisory board in August.
There was some initial pushback from state leaders against the move. Utah Governor Spencer Cox posted to X in response to Segil, “Mike, I appreciate you attempting this with a straight face, but I don’t remember the CFTC having authority over the ‘derivative market’ of LeBron James rebounds. These prediction markets you are breathlessly defending are gambling—pure and simple."
"They are destroying the lives of families and countless Americans, especially young men. They have no place in Utah. Let me be clear, I will use every resource within my disposal as governor of the sovereign state of Utah, and under the Constitution of the United States to beat you in court," he added.
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