A regulatory proposal from the Commodity Futures Trading Commission (CFTC) covering prediction markets is now under formal review at the White House, according to a filing published Tuesday and first reported by Bloomberg.
Key Takeaways
- CFTC prediction market rules are now under White House review, though details remain undisclosed.
- Trump backed the CFTC's federal authority claim as states challenge Kalshi and Polymarket.
- New York, Illinois, and Minnesota have escalated enforcement against sports-linked prediction market platforms.
The Office of Management and Budget is examining the rule, though the filing does not spell out its specific provisions. The submission landed on the same day President Trump took to Truth Social to publicly side with the CFTC in its escalating jurisdictional battle against state regulators.
Trump's post threw his weight behind CFTC Chairman Michael Selig's position that the agency holds exclusive federal authority over prediction market platforms such as Kalshi and Polymarket.
He framed the issue as a matter of national competitiveness, warning that foreign rivals are working to displace the U.S. in both prediction markets and cryptocurrency.
He also named four officials by name, calling Chris Christie, New York Attorney General Letitia James, Minnesota Gov. Tim Walz, and Illinois Gov. JB Pritzker obstacles to federal innovation policy.
The post landed amid active legal conflict between the CFTC and several states. Christie has publicly argued that prediction market contracts involving sports outcomes violate state gambling laws. James has filed lawsuits against Kalshi and Polymarket in New York over the same issue.
Gov. Pritzker issued cease-and-desist orders against platforms operating in Illinois, while Gov. Walz recently signed a bill making it a criminal offense to operate a prediction market in Minnesota. That became the first such law in the country.
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The political battle behind the regulatory fight
Trump's intervention is not happening in a vacuum. The federal-versus-state standoff over prediction markets has been building for months now. The core conflict centers on whether prediction market contracts, particularly those tied to sports outcomes, constitute federally regulated financial derivatives or state-regulated gambling products.
The CFTC treats them as the former; however, more than a dozen states see it differently and argue the products are functionally indistinguishable from sports betting.
Sports are where this tension is sharpest. As of February 2026, nearly 87% of the roughly $39.7 billion traded on Kalshi over the prior year involved sports contracts. That volume has drawn scrutiny from governors and attorneys general who say their state gambling laws should apply regardless of what the CFTC claims.
Trump's post has given the industry a significant political boost, but it has also deepened the partisan dimensions of the fight. Gov. Pritzker responded publicly, framing the administration's position as a conflict of interest given Trump family members' advisory roles at both Kalshi and Polymarket.
Illinois took action to prevent and ban insider trading with online prediction markets in our state.
— Governor JB Pritzker (@GovPritzker) May 26, 2026
The most corrupt President in our nation’s history wants to make sure states like ours can’t regulate prediction markets so his family and administration can keep profiting. pic.twitter.com/JZyS3aqNfA
“Illinois took action to prevent and ban insider trading with online prediction markets in our state,” Pritzker said in a post on X.
“The most corrupt President in our nation’s history wants to make sure states like ours can’t regulate prediction markets so his family and administration can keep profiting.”
The legal cases are already moving through federal appellate courts, with Supreme Court intervention widely expected.
