U.S. President Donald Trump said it was "critically important" that the CFTC keep "exclusive authority" over prediction markets, echoing CFTC Chair Michael Selig in a post on Truth Social, his social media platform, late Tuesday afternoon.
"Under my leadership, we are setting 'rules of the road' that are the Gold Standard for the States," he posted. "We cannot have SCUM like Chris Christie, Letitia James, Tim Walz, and JB Pritzker setting the rules!"
Former New Jersey Governor Chris Christie has defended states' authority to regulate gambling products, which he likened to prediction markets, on various occasions.
New York Attorney General Letitia James filed lawsuits similarly alleging that some prediction markets are violating state gambling laws; Illinois, headed by Governor J.B. Pritzker, sent a cease-and-desist; and Minnesota Governor Tim Walz last week signed a law enforcing criminal penalties for operating prediction markets.
The CFTC, led by Selig as the sole commissioner on the agency, has filed lawsuits and amicus briefs against various states, including the ones tied to the officials mentioned by Trump, defending its jurisdiction over prediction markets.
At the heart of the legal dispute is the question of whether prediction market contracts tied to sports and entertainment are really just gambling products dressed up as a novel financial instrument. The CFTC has taken the position that all prediction market contracts offered by regulated designated contracts markets (DCMs) fall under its jurisdiction, and that states do not have the right to infringe on that.
States, meanwhile, have taken the position that these contracts are actually gambling, and therefore should be supervised by state gaming regulators or banned entirely in states that don't allow such products.
Court cases have gone up to the federal appellate court level, and the issue is likely to appear before the U.S. Supreme Court at some point.
"Other Countries are after this new form of Financial Market, and we want to remain at the top," Trump's post continued.
A number of countries have recently banned prediction markets from operating within their borders, including Indonesia, Spain and India in the past week.
The U.S. government is also probing prediction markets, with a House of Representatives committee investigation being confirmed last week.
Over the weekend, The New York Times reported that the CFTC, under former Acting Chairman Caroline Pham, sidelined officials at the agency who raised concerns about approving crypto and other companies — specifically with ties to Trump's family businesses — that had applied for DCM approvals.
Neither the CFTC nor a spokesperson for Moonpay, Pham's current firm, immediately returned a request for comment on the article.
Trump's family has ties to various prediction market providers, with Donald Trump Jr., one of the president's sons, acting as an adviser to both Polymarket and Kalshi. Gemini, the crypto exchange launched by Cameron and Tyler Winklevoss, both public Trump supporters, also launched a prediction market platform and filed to self-certify parlay-type contracts late last week.
Trump also referred to his campaign trail pledge to make the U.S. the "crypto capital" in his post on Wednesday.
"Likewise, and even more importantly, where we are currently the Crypto (Bitcoin, etc.) Capital of the World, other Countries are trying diligently to replace us in that capacity, but we won’t let that happen," he posted.