#PredictionMarketsCFTCBacking : U.S. Regulator Takes Strong Stance in Legal Fight Over Prediction Markets

The U.S. Commodity Futures Trading Commission (CFTC) is firmly backing prediction markets — platforms like Kalshi and Polymarket that let users trade contracts on real‑world outcomes — in a major regulatory battle with several states trying to ban or restrict them. CFTC Chair Michael Selig has taken an assertive approach, including:

👉 Filing amicus briefs in federal appeals to defend CFTC jurisdiction over prediction markets and asserting exclusive authority under federal derivatives law.

👉 Publicly rejecting an earlier proposed ban on political and sports prediction markets, clearing the way for platforms to operate under CFTC oversight.

👉 Appointing executives from prediction market firms to a CFTC Innovation Advisory Committee — signalling openness to innovation in this space.

Support from the regulator has put federal power sharply at odds with state regulators like those in Nevada, who argue platforms resemble unlicensed gambling. The conflict may ultimately end up in higher courts as the CFTC pushes back against state bans and defends a framework where prediction markets are regulated as derivative instruments, not outlawed betting products.