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The CFTC's Word Games Legalizing Gambling by Eleanor Davis-Diver
So far in his second term, President Trump has only filled one of five commissioner seats on the Commodity Futures Trading Commission (CFTC). By complete coincidence, that commissioner, agency chair Mike Selig, happens to be an evangelist for prediction markets like Kalshi and Polymarket—both advised by Donald Trump Jr.
Sports betting and other gambling products masquerading as “event contracts” have exploded since Trump regained office, entirely thanks to the administration’s control of a radically transformed CFTC. The unassuming regulator has become the all-powerful patron of prediction markets, ignoring the derivative products the agency is supposed to be overseeing and dedicating its time and resources to unilaterally legalizing gambling in all 50 states, whether the states like it or not.
The CFTC has been engaged in a legal struggle with various states over regulatory jurisdiction, which will likely lead to a showdown in the Supreme Court. Following the lead of the industry, the CFTC has argued that federal commodities law preempts any state gambling laws and gives it exclusive authority over event contracts on prediction markets.
The latest move in this fight is a fantastical bit of legal gymnastics performed in a notice of proposed rulemaking released last month. The 66-page document is almost entirely dedicated to twisting the meaning of specific words and phrases while employing a series of logical leaps to rewrite the law and the agency’s own regulations, while parroting industry talking points differentiating the sports-based contracts on prediction markets from what they plainly are.
Sports betting and other gambling products masquerading as “event contracts” have exploded since Trump regained office, entirely thanks to the administration’s control of a radically transformed CFTC. The unassuming regulator has become the all-powerful patron of prediction markets, ignoring the derivative products the agency is supposed to be overseeing and dedicating its time and resources to unilaterally legalizing gambling in all 50 states, whether the states like it or not.
The CFTC has been engaged in a legal struggle with various states over regulatory jurisdiction, which will likely lead to a showdown in the Supreme Court. Following the lead of the industry, the CFTC has argued that federal commodities law preempts any state gambling laws and gives it exclusive authority over event contracts on prediction markets.
The latest move in this fight is a fantastical bit of legal gymnastics performed in a notice of proposed rulemaking released last month. The 66-page document is almost entirely dedicated to twisting the meaning of specific words and phrases while employing a series of logical leaps to rewrite the law and the agency’s own regulations, while parroting industry talking points differentiating the sports-based contracts on prediction markets from what they plainly are.
https://prospect.org/2026/07/15/cftcs-word-games-legalizing-gambling-prediction-markets-kalshi-polymarket/]