CFTC's Selig opens legal dispute against states getting in way of prediction markets

Policy Share Share this article Copy link X icon X (Twitter) LinkedIn Facebook Email CFTC's Selig opens legal dispute against states getting in way of prediction markets Commodity Futures Trading Commission Chairman Mike Selig fired a legal warning shot defending his agency's jurisdiction over the event contract space. By Jesse Hamilton | Edited by Nikhilesh De Feb 17, 2026, 3:59 p.m. Make us preferred on Google U.S. Commodity Futures Trading Commission Chairman Mike Selig says his agency has the regulatory authority over prediction markets, not the states. (Jesse Hamilton/CoinDesk) What to know : U.S. Commodity Futures Trading Commission Chairman Mike Selig directed his agency to file an amicus brief declaring his federal agency has authority over the U.S. prediction markets. Though the CFTC once fought a legal resistance against such firms as Polymarket and Kalshi, the agency has embraced them during the administration of President Donald Trump, whose son has worked as a paid adviser for the leading companies. As Selig defends his agency's jurisdiction in court, he's also pursuing new prediction markets rules for the U.S. The legal challenges from state governments against certain aspects of prediction markets such as Polymarket and Kalshi received a sharp rebuke from U.S. Commodity Futures Trading Commission Chairman Mike Selig, who is arguing that his federal agency has jurisdiction — not the states. STORY CONTINUES BELOW Don't miss another story. Subscribe to the State of Crypto Newsletter today . See all newsletters Sign me up By signing up, you will receive emails about CoinDesk products and you agree to our terms & conditions and privacy policy . "To those who seek to challenge our authority in this space, let me be clear, we will see you in court," Selig said in a video statement posted Tuesday on social media site X. He said his agency filed a legal brief in court to back up the federal role as the leading regulator over this corner of the derivatives markets. "The CFTC has regulated these markets for over two decades," he said. "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." Selig did not mention sports bets in his list of examples, though that's where many of the legal disputes are focused. States have gone after event-contract platforms with accusations they've breached sports-betting laws at the state level, such as in Nevada, Massachusetts and New York . A federal judge in Nevada concluded in November that the state authorities were correct and that the contracts aren't properly the business of the CFTC, though that ruling is under appeal. Coinbase, the top U.S. crypto exchange, has also sought to enter the prediction markets sector, and it's currently suing Connecticut, Illinois and Michigan over those states' attempts to regulate sports betting as gaming. That's the setting that Selig is weighing into as he declares "exclusive jurisdiction over these derivative markets." But until the return to Washington of President Donald Trump, the agency had fought against these companies and some of their contracts, claiming that the sites' political bets were unlawful and "contrary to the public interest." But courts had gone against the CFTC in its legal fight with Kalshi, and when Trump's administration overhauled the agency's leadership, the fight was abandoned . In early 2025, the president's son, Don Trump Jr., joined Kalshi as a strategic adviser. In August, he then joined Polymarket's advisory board . In October, Trump Media & Technology Group (DJT), which owns President Donald Trump’s social platform Truth Social, said it was getting into the prediction markets business . Within weeks of his confirmation by the Senate, Trump nominee Selig said that his agency was resetting its prediction markets approach and would pursue new policies on that front. He said the CFTC "will advance a new rulemaking grounded in a rational and coherent interpretation of the Commodity Exchange Act that promotes responsible innovation in our derivatives markets in line with Congressional intent." 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