Catenaa, Wednesday, February 18, 2026- The Commodity Futures Trading Commission filed an amicus brief Tuesday in the Ninth US Circuit Court of Appeals asserting exclusive federal authority over prediction markets.
The move could potentially escalate the legal clash with several states seeking to regulate the platforms as gambling.
CFTC Chairman Michael Selig said the agency moved to defend its jurisdiction as states pursue nearly 50 active cases against companies offering event contracts. The brief backs Crypto.com in its dispute with the Nevada Gaming Control Board over sports-event contracts.
The filing argues Congress granted the CFTC exclusive oversight of futures and swaps under the Dodd-Frank Act. The agency said event contracts fall within that mandate as commodity derivatives rather than gambling products.
Prediction market operators such as Kalshi and Polymarket have faced scrutiny across multiple states. The platforms allow users to trade on outcomes tied to sports, politics and other events.
Nevada previously challenged Crypto.com’s sports contracts under state gaming laws. A lower court ruled the contracts were not within CFTC jurisdiction, prompting an appeal.
Selig said the commission would defend its authority in federal court and draft clearer rules governing prediction markets. He described event contracts as swaps processed through clearinghouses with investor safeguards.
Democratic lawmakers have urged caution, warning that some contracts mirror sportsbook wagers and may bypass state consumer protections. Republican lawmakers have backed federal clarity.
Utah Gov. Spencer Cox called prediction markets gambling and pledged to fight federal intervention.
The dispute sets up a broader test of federal versus state control over fast-growing event contract markets.
