CFTC Chair Michael Selig files an amicus brief to defend federal oversight of prediction markets amid state lawsuits and Senate scrutiny.
The chair of the US Commodity Futures Trading Commission said the agency will continue defending its authority over prediction markets as several states pursue legal action against related platforms.
His remarks come amid growing tension between federal regulators and state authorities over who has jurisdiction over event-based contracts.
CFTC Files Amicus Brief to Defend Jurisdiction
Michael Selig, chair of the Commodity Futures Trading Commission, said the agency filed an amicus brief in response to ongoing litigation involving prediction market platforms.
He described the filing as an effort to defend the CFTC’s “exclusive jurisdiction” over markets that it considers derivatives.
In a video posted on X, Selig stated that prediction markets fall within the scope of federal derivatives regulation.
He said the CFTC has overseen such markets for more than two decades and intends to maintain that role. “Prediction markets aren’t new – the CFTC has regulated these markets for over two decades,” he said.
Selig added that prediction markets allow individuals to hedge commercial risks and assess public information.
He said that if state authorities challenge the CFTC’s oversight, the agency is prepared to respond through the courts. He referred to recent state actions as an “onslaught of state-led litigation.”
States Challenge Event Contract Platforms
Several state regulators have filed legal actions against platforms that offer event-based contracts. These include Coinbase, Crypto.com, Kalshi and Polymarket.
The cases focus on whether such contracts fall under state gambling laws or federal derivatives rules.
Polymarket recently filed a lawsuit against the state of Massachusetts. The company argued that the CFTC, as a federal regulator, has sole authority to police prediction markets.
The dispute centers on whether state authorities can enforce their own laws in this area.
Selig has also reiterated his position in a Wall Street Journal opinion piece.
He wrote that states were “encroaching” on the CFTC’s authority. His comments have drawn attention from lawmakers and market participants who are monitoring the legal developments.
Related Reading: CFTC Chair Michael Selig Signals Lighter Crypto Oversight Under ‘Future Proof’ Plan
Senate Scrutiny and Pending Legislation
A group of 23 US senators sent a letter to Selig urging restraint. They asked him to “abstain from intervening in pending litigation” and to align the agency’s actions with existing statutes and prior testimony.
The senators wrote that recent comments suggest a shift in regulatory posture.
They said this approach could place the Commission in conflict with state and tribal governments whose gambling laws were not preempted by Congress.
At the same time, lawmakers continue to consider a digital asset market structure bill.
The House passed the CLARITY Act in July, and the Senate Agriculture Committee advanced it in January.
It remains uncertain whether the full Senate will take up the measure in the coming months.
Source: https://www.livebitcoinnews.com/cftc-chair-vows-to-defend-prediction-markets-from-state-lawsuits/
