Commodity Futures Trading Commission (CFTC) Chairman Michael Selig faced sustained questioning from members of the House Committee on Agriculture on Thursday over the agency’s oversight of sports event contracts, repeatedly deferring to a pending rulemaking process rather than committing to substantive positions on the industry’s most contested regulatory questions.
Gaming stakeholders across the US were keyed into the hearing, with the sharpest questions coming from committee members whose jurisdictions include legal sports betting or tribal gaming operations. Selig’s opening remarks referenced the CFTC’s advanced notice of proposed rulemaking for prediction markets, a message he returned to throughout the session when pressed to offer concrete positions. He stated on multiple occasions that he would not “pre-judge” aspects of prediction markets before that rulemaking was formally established.
Committee Chair Representative GT Thompson (R-Pennsylvania) set the tone by stating that the growth of prediction markets has produced “significant confusion and debate” about the CFTC’s role and authority, and what falls within the scope of the Commodity Exchange Act (CEA).
The Visual Aid Moment
The hearing’s most pointed exchange came when Representative Gabe Vasquez (D-New Mexico) produced a visual comparison of prediction market contracts and state-regulated sportsbook odds on the same Colorado Rockies versus Houston Astros game, and asked Selig to identify which was which. Selig said he was not an expert on betting lines. Vasquez responded: “Because the average consumer also can’t tell — yet they are regulated completely differently.”
Representative Jim Costa (D-California) stated that sports event contracts are undercutting tribal governments and harming states that have declined to legalise online sports betting, arguing that Congress never intended sports wagering to be repackaged as a financial product. Vasquez echoed the position, contending that prediction market companies exploiting federal loopholes undermine both tribal gaming sovereignty and state-level sports betting regulation.
Enforcement and Conflicts of Interest
On enforcement, Selig sought to project a firm posture: “I want to be crystal clear to anyone who engages in fraud, manipulation or insider trading in any of our markets: we will find you, and the full force of the law will come to bear.” He confirmed the CFTC is engaged in numerous ongoing investigations into prediction market activity.
Committee members also raised the involvement of President Trump’s family in the prediction market sector, with his son having been named as an advisor to both Kalshi and Polymarket. Selig stated the CFTC does not engage in favoritism or introduce political considerations into its regulatory decisions.
Rulemaking and Market Scale
The CFTC’s advanced notice of proposed rulemaking on prediction markets was posted to the Federal Register on 16 March, with a public comment period running through this month. More than 800 submissions have been filed, including a letter from Nevada Representative Dina Titus — who has separately authored prediction market legislation — stating that platforms “conflating sports betting with a form of investment” carry “serious consequences for consumers who may misunderstand the risks involved and assume protections that do not exist.”
Thursday’s hearing ran concurrently with oral arguments before a Ninth Circuit Court of Appeals panel in a consolidated set of cases pitting state regulators against prediction market operators — proceedings in which the CFTC has filed an amicus brief asserting its jurisdictional authority.
The American Gaming Association has estimated that prediction market platforms operating outside state-licensed frameworks have cost US states nearly $800 million in potential tax revenue since the start of 2025. With the CFTC’s comment period closing this month and formal rulemaking still ahead, the question of which regulatory framework governs sports event contracts remains unresolved — and the stakes for licensed operators, tribal nations, and state governments are growing by the week.