U.S. President Donald Trump openly defended the Commodity Futures Trading Commission’s (CFTC) authority over prediction markets. In a post on Truth Social, Trump backed his appointed CFTC Chairman Michael Selig while once again making his stance on the crypto sector clear.
“Critically important”
Trump’s post on Tuesday was brief but direct: “It is critically important to preserve the CFTC’s exclusive authority over prediction markets and allow these markets to grow.”
The president also highlighted the country’s position in the crypto space. “Other countries are chasing these new financial markets. We want to maintain our place at the top. Right now, we are the crypto capital of the world; others are trying to knock us off that position, but we will not allow it,” he said.
Selig has long argued that the CFTC has “exclusive jurisdiction” over prediction markets. In this context, he has sued five states, including Wisconsin, Illinois, Arizona, Connecticut and New York. These states argue that platforms such as Polymarket and Kalshi violate local gambling regulations, while Selig insists that the agency’s authority should be interpreted broadly.
Prediction markets have grown rapidly in the U.S., especially after the 2024 presidential election cycle. Initially seen as a niche area of interest, these platforms now generate tens of millions of dollars in trading volume.
NYT investigation casts a shadow
Trump’s statement came shortly after a broad investigation published over the weekend by The New York Times. According to the NYT, senior CFTC employees who raised concerns about Polymarket, Crypto.com and other firms with business ties to the Trump family were pushed out of the agency. The investigation raised serious questions about the agency’s internal operations.
Reactions came quickly. Democratic Senator Richard Blumenthal sharply criticized the CFTC in a post on X. “The CFTC has become a captive of prediction markets and shady crypto firms; it is ignoring national security risks while pressuring state regulators and punishing its own staff for trying to enforce the law,” he said.
Crypto test
Trump’s recent stance reinforces his promises to support the crypto sector. The president describes the industry as “a big industry” and emphasizes that the U.S. needs to get ahead in global competition. However, the debates inside the CFTC and the NYT investigation have pushed questions about what is happening behind this support higher on the agenda.
The tension between states and the federal regulator over prediction markets remains unresolved. With Trump directly stepping in, this tension has now moved beyond a purely legal dispute and turned into a political issue. How the CFTC uses this authority in the coming period will be decisive for both the prediction markets sector and the broader crypto ecosystem.
