Commodity Futures Trading Commission (CFTC) Chairman, Michael Selig, said he will not wait for the appointment of additional commissioners to lead the regulatory agency before moving forward on rulemaking related to digital assets and prediction markets.
At a Thursday hearing of the House Agriculture Committee, Selig responded to questions from Ranking Member Angie Craig, who called out the lack of leadership at the CFTC, which typically has a bipartisan panel of five commissioners. The Minnesota representative asked the Speaker to commit to not finalizing the rules while he is the sole Commissioner.
“In the interim, we cannot delay our rulemaking, for the sake of the American people,” Selig said. “It is very important that we have investor protection, consumer protection and safeguards for our markets. And so, unfortunately, I cannot commit to not doing my job for which I was appointed by the President.”
Selig, who has served as the sole commissioner and chair of the CFTC since December, has come under scrutiny from several lawmakers for unilaterally leading the agency on rules favoring crypto and prediction markets without a bipartisan commissioners group. As of Thursday, President Donald Trump had not publicly announced any nominations to staff the agency nor indicated he intended to do so.
“We’re going to do more work through rule-making,” Selig said in response to a question on the CFTC’s leadership from Representative Don Davis. “We can’t ask employees to use their discretion to decide what the rules are.”
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The CFTC chair proposed rulemaking in March that could amend or issue new rules on event contracts on prediction markets. Selig has been vocal in claiming that the agency has “exclusive jurisdiction” over prediction markets because the companies behind some platforms face state-level lawsuits related to sports betting laws and proposed legislation to crack down on insider trading.
CFTC’s legal battle over prediction markets continues
Gaming authorities in several US states have filed lawsuits against prediction market companies like Kalashi and PolyMarket, alleging that the platforms offer sports betting in violation of state laws.
Representative Gabe Vasquez of New Mexico questioned Selig at Thursday’s hearing with a visual aid showing that bets on event contracts and through state-level gaming “are not much of a difference, yet they are regulated completely differently.” He accused the CFTC of using “loopholes” to circumvent state laws and requirements of prediction markets, causing some jurisdictions to miss out on revenue.
“The CFTC was not created or intended to regulate sports gambling,” Vasquez said.
“Are we controlling real economic risk, or are we allowing prediction markets to steal billions of dollars in an unregulated free-for-all with no consumer protections because Congress and the CFTC turn a blind eye?”
Companies like Kalshi have argued that they are under the sole jurisdiction of the CFTC. That argument led the company to court victories in Arizona and New Jersey, where judges this month blocked state officials from taking action against Kalshi.
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