The legal challenges by state governments against certain aspects of prediction markets such as Polymarket and Kalshi drew a sharp rebuke from the chairman of the US Commodity Futures Trading Commission, Mike Selig, who argues that his federal agency has jurisdiction – not the states.
“To those who seek to challenge our authority in this area, let me be clear, we will see you in court,” Selig said in a video statement posted Tuesday on the social media site X. He said his agency filed a legal brief in court to back the federal role as the lead regulator over this corner of the derivatives markets.
“The CFTC has been regulating these markets for over two decades,” he said. “They provide useful functions for society by allowing ordinary Americans to hedge against commercial risks like temperature increases and energy price increases; they also serve as an important check on our news media and our information flows.”
Selig did not mention sports betting in his list of examples, even though that is where many of the legal disputes are focused. States have gone after event contracting platforms with allegations that they violated state-level sports betting laws, 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 are not properly the CFTC’s case, although that ruling is under appeal.
Coinbase, the top US crypto exchange, has also tried to enter the prediction markets sector and is currently suing Connecticut, Illinois and Michigan over those states’ attempts to regulate sports betting as gambling.
That’s the setting Selig is considering when he declares “exclusive jurisdiction over these derivative markets.” But until President Donald Trump’s return to Washington, the agency had been fighting those companies and some of their contracts, arguing that the sites’ political bets were illegal and “contrary to the public interest.” But the courts had gone against the CFTC in its legal battle with Kalshi, and when the Trump administration reviewed the agency’s management, the fight was abandoned.
In early 2025, the president’s son, Don Trump Jr., joined Kalshi as a strategic advisor. 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 entering the prediction market business.
Within weeks of being confirmed by the Senate, Trump nominee Selig said his agency was resetting its approach to predicting the markets and would pursue new policies on that front. He said the CFTC “will promote new rulemaking based on a rational and coherent interpretation of the Commodity Exchange Act that promotes responsible innovation in our derivatives markets consistent with Congressional intent.”
In the hours after Selig’s Tuesday statement, Utah Gov. Spencer Cox responded with his own challenge.
“Mike, I appreciate you trying to put a straight face on this, but I don’t recall the CFTC having authority over the ‘derivative market’ of LeBron James rebounds,” he wrote in a response to X. “These prediction markets you breathlessly defend are gambling – pure and simple. They are ruining the lives of families and countless young men, they have no special place in Utah.”
While Utah has not been among the states waging legal challenges against the prediction markets, there is a legislative effort there that seeks to target certain sports contracts. Cox advised Selig that he would use any force to “beat you in court.”
And U.S. Sen. Elizabeth Warren, the ranking Democrat on the Senate Banking Committee, argued that Selig undermines state power.
“President Trump’s CFTC chairman is trying to strip states of their authority to regulate gambling within their borders and hamper their ability to protect Americans from being cheated,” she said in a statement. “The CFTC should focus on making sure our derivatives markets don’t blow up the economy again and don’t help corrupt political insiders cash in.”
UPDATE (17 February 2026, 17:59 UTC): Adding response from Utah Governor.
UPDATE (February 17, 2026, 21:30 UTC): Adds statement from Senator Warren.
