The head of the regulator of the constantly shifting US predictions markets scene was finally confirmed last week, occurring in the midst of legal battles, market launches, and near constant discourse.
Michael Selig was confirmed late last week as the new Chair of the Commodity Futures Trading Commission (CFTC), the federal regulator of derivatives markets and so, by extension, the essential regulator of the burgeoning prediction markets space.
The CFTC’s new Chair was confirmed by 53 votes to 43 in the Senate. His background in finance and particularly crypto was key to his nomination, having held the role of Chief Counsel of the Securities and Exchange Commission’s (SEC) Crypto Taskforce since March.
As such, the predictions platforms operated by Kalshi,Polymarket andCrypto.com, and now betting and gaming firms like DraftKings, Flutter Entertainment’s FanDuel, and Allwyn’s PrizePicks will fall under his regulatory remit – though from the outset, predictions will not be top priority.
The CFTC has been taking a hands-off approach to prediction markets under the Donald Trump administration, having been much more stringent in how it regulated the platforms under the presidency of Joe Biden.
Under Selig, it is likely that the CFTC will focus on implementing Trump’s cryptocurrency agenda, with the President having set out ambitions for the US to become an international leader in cryptocurrencies, particularly stablecoins, while remaining vocally opposed to Central Bank Digital Currencies (CBDCs).
Overseeing the chaos
From what we have seen so far, Selig’s stance on predictions is essentially that the matter should be left to the courts. This continues the CFTC’s approach to prediction markets under Trump, with the regulator opting not to act on the flood of new markets these companies are introducing, leaving state regulators and prediction platforms to settle legal disputes themselves.
Selig summed up his stance on predictions neatly while appearing before the Senate Committee on Agriculture, Nutrition, and Forestry during a confirmation hearing back in November.
When asked about his view on predictions, he said: “I intend to always adhere to the law and follow what judicial decisions tell me to follow. I also believe that these types of issues are ones we can work through together. Some of them are Congressional issues, as to whether we change statutes in certain areas.”
Even with his laissez-faire approach to prediction markets, Selig is still far from the most controversial candidate for the role – that title could be reserved for Brian Quintenz, Trump’s former pick for leadership of the CFTC.
The potential for Quintenz to become CFTC Chair got a few people in gambling particularly riled up, including the American Gaming Association (AGA) and tribal gaming organisations. This was due to Quintenz sitting on the Board of Directors of Kalshi at the time, while also being a former advisor to Crypto.com.
That said, the two are not entirely carbon copies of each other. Quintenz was much more confident that sports events contracts met the criteria of the Commodity Exchange Act (CEA), while Selig seems to believe it can be more open to interpretation. Nonetheless, the newcomer’s approach is a far cry from the more critical view the CFTC took under Biden.
While he may continue this hands off approach, Selig will find himself overseeing a hugely chaotic market, albeit one which is capturing the attention of an increasing number of stakeholders.
It is also a task that, for now, he will be largely doing himself. Caroline Pham, acting CFTC Chair, is obviously stepping down from the role, but is also departing the CFTC entirely. The Commission usually has five Commissioners, including the Chair, but as it stands it has only one – Selig.
This could mean he is stretched for resources in overseeing two very complex and often controversial matters, crypto and predictions, though it could also mean that he has more room to get his own way.
DraftKings enters the fray, UK keeps watch
This is perhaps stating the obvious, but the first firms to bring attention to the predictions space were the companies which specialised in this space alone. Polymarket was one of the early movers, though a 2020 settlement with the CFTC led to it geoblocking US customers.
Kalshi has built up a formidable position in the US, and earlier this month secured a valuation of over $11bn. Meanwhile, Polymarket made its return via an acquisition and subsequent rebrand this year, while Robinhoood and the above mentioned Crypto.com have also got involved, the former via a partnership with Kalshi.
Not wanting to get left out, gambling companies have since thrown their hats into the ring, notably Flutter’s FanDuel via the FanDuel Predicts platform and Fanatics’ Fanatics Markets. FanDuel’s platform was announced former having been announced in November and going live in Alabama, Alaska, South Carolina, North Dakota and South Dakota yesterday, with further state launches planned in 2026.
James Cooper, Senior Vice President, Flywheel and New Ventures at FanDuel, said: “We’re giving our customers a new platform to engage with the world around them – whether that’s the next Fed rate decision or a sports event.
“This launch in five states will provide valuable insights into customer engagement with this new platform, enabling us to refine our approach as we expand to additional states in 2026.”
FanDuel’s main competitor, DraftKings, has also joined the club with DraftKings Predictions, while micro-betting platform Betr has applied to register with the National Futures Association (NFA) to launch its own platform. Just yesterday, Coinbase announced it was acquiring predictions market The Clearing Company so that the crypto exchange can carve out its own slice of the pie.
The most notable thing about DraftKings’ launch is the geography of it – 38 US states, including California, Texas and Georgia, the three biggest states with no regulated online gaming market, but as predictions are not considered betting by the CFTC, these states are technically fair game unless the local government challenges it.
DraftKings Chief Product Officer, Corey Gottlieb, said: “DraftKings Predictions is a significant milestone and reflects our ongoing commitment to delivering products that tap into the passion of our customers.”
Other international stakeholders are setting up shop too. Allwyn acquired daily fantasy sports (DFS) platform PrizePicks earlier this year, and shortly after its new asset announced that it was going to start expanding into predictions in partnership with Kalshi. This came two months after Underdog, its main DFS competitor, also moved into predictions in partnership with Crypto.com.
In a more recent development, UK betting exchange Matchbook announced that it will launch its own platform in its home nation before embarking on a US expansion.
Whether or not predictions can find a niche in the UK remains to be seen, however, with many in the country scratching their heads as to how a prediction market and betting exchange differ from one another.
Then there are also the legal battles to consider. Selig seems content to leave matters to the courts, and that means he’ll be leaving a lot of matters to the courts – Kalshi is involved in litigation with seven state regulators.
The predictions market scene in the US is rapidly moving, heavily influenced by legal developments. Companies interested in taking it on should take heed, with a change in administration, and therefore a new head at the CFTC, 2028 could usher in a new approach to the platforms that could turn the market on its head once again.