CFTC Chair Michael Selig says the agency will take its fight with states over prediction markets to the Supreme Court if needed. The CFTC is suing at least 10 states, and early rulings have favored the agency.
CFTC Chair Michael Selig said on October 30, 2026 that the agency will defend its exclusive authority over derivatives markets against state challenges. According to Selig: "We’re prepared to fight these challenges all the way up to the Supreme Court."
The remark comes as the regulator takes legal action against at least 10 states, including Arizona, Connecticut, Illinois and Utah.
States treat event contracts as gambling
The dispute centers on prediction markets and event contracts, which let people trade on the outcome of real-world events. The first lawsuits were filed in April 2026, and the tally had grown to 10 federal cases by late October.
States have increasingly treated these products as gambling. Some have pursued enforcement actions, while others have moved legislation aimed at reining them in.
The CFTC sees it differently. Its position is that when these contracts trade on federally registered exchanges, federal authorities are in charge rather than the states.
Federal preemption is the core argument
The agency rests its case on the Commodity Exchange Act, specifically 7 U.S.C. § 2(a)(1)(A). Selig argues the law grants the CFTC exclusive jurisdiction over swaps and futures traded on designated contract markets, which are exchanges registered with and supervised by the CFTC. The agency's view is that federal preemption should override conflicting state rules aimed at those venues.
Beyond its own suits, the CFTC has filed amicus briefs in four federal appeals courts and one state supreme court as of late October 2026. Early rulings have leaned toward the agency: preliminary injunctions supporting the CFTC were granted in initial rulings in cases from Arizona and Illinois.
The platforms caught up in the litigation include Kalshi, Polymarket and Crypto.com/Nadex.
What to watch next
Selig was sworn in on December 22, 2025 after being nominated by President Trump. His pledge suggests the agency is willing to see the fight through multiple rounds of appeals rather than accept a split outcome.
A loss for the CFTC could force prediction market platforms to navigate a different set of restrictions in each state that objects. A win would confirm a wide scope for federal oversight of event contracts.
Source: Crypto Briefing
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