U.S. Commodity Futures Trading Commission (CFTC) Chairman Michael Selig said Tuesday that Congress granted his agency exclusive authority to regulate prediction markets.
This assertion marks a significant escalation in the struggle between federal regulators and state governments over who controls the legality and oversight of event-based betting. A fragmented regulatory landscape could create legal uncertainty for operators and users of these platforms.
Speaking during an interview on CNBC’s "Squawk Box" program, Selig said that the agency is now asserting this jurisdiction against state-level actions. He said that Congress was very clear that the CFTC is the exclusive regulator of prediction markets.
To enforce this uniform federal framework, the CFTC has filed a lawsuit in a Wisconsin federal court. The agency said the move is intended to prevent a patchwork of state-by-state regulations, which it maintains was the intent of Congress.
Not everyone agrees with the agency's interpretation of its powers. Bill Miller, CEO of the American Gaming Association, called the CFTC a "rogue agency."
In a separate summary of an op-ed, Selig responded to critics by saying, "See you in court."
The dispute comes as the agency manages significant public interest in the sector. The CFTC has received more than 1,500 [1] responses to its prediction-market rulemaking proposal.
“"Congress was very clear that the CFTC is the exclusive regulator of prediction markets."”
The conflict between the CFTC and state authorities represents a fundamental jurisdictional battle. If the courts uphold the CFTC's claim of exclusive authority, it would strip states of the power to legalize or ban prediction markets independently, centralizing all oversight under a single federal entity to ensure national consistency in financial derivative trading.
