‘cowboy’: Michael Selig Takes On Political Giants Over Prediction Markets

Michael Selig is making a play for a new title in Washington: chief betting market regulator.

He’ll just have to take on state officials, lawmakers, tribal organizations and some potential 2028 presidential candidates.

The Wall Street regulator argues his agency, the Commodity Futures Trading Commission, should be the sole watchdog for buzzy prediction market upstarts like Kalshi and Polymarket U.S. given that they are federally regulated financial exchanges. Yet his many opponents counter that they are, at heart, gambling companies that should fall under state regulations.

Just over three months on the job, Selig, 36, has eschewed the discretion and tone with which federal financial regulators usually talk about regulated companies. Instead, he frequently claps back on social media at prediction market critics like Rep. Alexandria Ocasio-Cortez and former New Jersey Gov. Chris Christie, who likened him to “a cowboy.” The CFTC recently sued Arizona, Connecticut and Illinois in a bid to block the states’ attempted clampdowns on the markets — a move that Selig foreshadowed on X weeks earlier: “We will see you in court.” And on Thursday, he’ll take his campaign to Capitol Hill, where he’ll be testifying in front of the House Agriculture Committee.

“These are not casinos. These are not sportsbooks. They’re markets,” Selig told POLITICO in an interview. “The bottom line is, we’re going to defend our authority in court.”

Prediction markets — where users can wager on U.S. elections, the Masters and whether a congressional stock trading ban will ever become law — have long operated in the U.S. under the CFTC’s watch. But their growing footprint in sports has ignited an uproar among states and tribes who already oversee or outright ban traditional types of sports gambling, like sportsbooks and casinos.

His push to defend his turf — and the prediction market industry more broadly — amounts to a legacy-defining gambit for Selig. If successful, the effort would cement his agency’s status as the preeminent U.S. regulator for the high-flying industry, which now sees several billions of dollars in weekly trading volumes and whose growth has come in part thanks to President Donald Trump’s friendlier regulatory environment. But Selig’s embrace of the markets has startled many long-time CFTC officials and watchers who warn that he risks undercutting the agency’s credibility.

“He’s not trying to pretend that he’s a normal regulator,” said an attorney who works on CFTC issues and was granted anonymity to speak candidly. “He’s acting more like a cheerleader for the industry.”

Lawmakers on both sides of the aisle have also grown increasingly concerned about the risk of insider trading on prediction markets, following a string of highly profitable and prescient wagers that have sent off alarm bells. Both Kalshi and Polymarket, the best-known prediction markets in the world, recently unveiled measures intended to thwart such activity on their platforms.

Others have blasted what they view as morally questionable markets. Last week, for example, Polymarket briefly offered trading on the rescue of the American pilots whose plane was downed over Iran — prompting outrage in Washington. The company offered the product on its international platform, which is not regulated by the CFTC and supposed to be closed off to U.S. customers. It later said the market never should have gone live.

Selig is unbothered.

“I’m not focused on what’s happening offshore,” he said, sitting in a conference room at the agency’s downtown headquarters.

“It’s important that we not focus on regulating by enforcement and going on witch hunts offshore,” he added, before noting that the CFTC is working with its international contemporaries to ensure “there’s nothing that raises risks to our markets, U.S. persons or American national security.” “The most important thing for a market regulator and my policy aim is to set rules that work for Americans. If we try to push things offshore, create black markets, that never works well for the country.”

As for claims that he’s a prediction-market booster, Selig didn’t hold back: “I’m not a merit-based regulator. I’m not a cheerleader for any particular industry. What I do believe in is technology that provides greater freedom to the American people.”

Kalshi declined to comment for this report, while Polymarket spokespeople did not respond to a request for comment.

Prediction markets are only a fraction of the CFTC’s sweeping jurisdiction, which covers everything from corn futures to crude oil options. But the platforms have seen a rush of new interest over the last year. Kalshi’s weekly trading volumes are now more than $3 billion, which is up from roughly $100 million a year ago, according to Bank of America. Analysts at the bank project that the long-term potential market for regulated sports prediction markets alone could be as much as $1.1 trillion in annual volumes.

Today, the fight swirling around the industry is largely playing out in the courts. And judges across the country have already issued a smattering of conflicting rulings on the question of who should oversee the prediction markets, likely setting the stage for a high-profile Supreme Court battle in the coming years. The latest ruling, out of a federal appeals court in Philadelphia, landed in favor of Kalshi’s arguments that the CFTC is its sole regulator.

But pressure is rising elsewhere, too. A bipartisan collection of lawmakers is expressing mounting concern about the prediction markets and their regulation. And the market’s opponents are racing to turn what had been a wonky legal fight over federal preemption — or the idea that the federal government’s regulations supersede state law — into a fight in the court of public opinion.

Utah Gov. Spencer Cox, a Republican, bashed Selig’s stance on the prediction markets as “a joke” earlier this year. A spokesperson for the office of Illinois Gov. JB Pritzker, a potential 2028 presidential contender, fired back at the CFTC’s lawsuit last week as the Trump administration “carrying water for companies driving well-documented and lucrative insider trading schemes.” And while Selig argues the states are trying to infringe on his agency’s authority, Christie, who is working as an adviser to the American Gaming Association, sees the CFTC chair as stomping on the states’ territory.

“He’s probably going to wind up getting sued by 30-plus states,” Christie said in an interview. “To, like a cowboy, enter someplace where he was not needed and leave it worse than he found it, that’s not usually what regulators do.”

The AGA, a staunch opponent of the prediction markets, represents the deep-pocketed traditional gaming industry.

For Selig’s supporters, the CFTC chair is doing exactly what he should be doing: Defending the agency’s authority while working toward new rules for the prediction markets.

“He’s trying to build a lot of discipline into these markets,” said Carl Kennedy, a former CFTC official who is co-chair of the financial markets and regulation practice at the law firm Katten. “He’s seeing the same problems, and he’s trying to address it — I think, while being supportive, in a way that’s bringing order.”

Selig has spent recent weeks popping up on podcasts from the likes of conservative host Clay Travis, Bankless and ESPN, making his case for the CFTC’s authority over the prediction markets. On the ESPN episode, a Make America Great Again hat could be seen on a bookshelf over his shoulder.

The CFTC is exploring new rules for the prediction markets. Last month, the agency asked the public for feedback on a lengthy list of questions that indicated it was examining everything from insider trading guardrails to what types of products should be allowed on the prediction markets.

Selig readily acknowledges that most prediction markets are not the same as the commodity-linked markets the CFTC has historically overseen.

He said the agency will “certainly have to make some changes” to account for the rising presence of individual investors in its markets, which have historically been dominated by large institutions. And he suggested he’s open to considering new ideas like age restrictions on prediction markets, should the public ask for them.

“My goal is just to make sure that there’s the space for that technology to flourish and develop here,” Selig said. “And I think the market forces take care of everything else.”

But his critics aren’t easing up. In an interview, Sen. Jeff Merkley, an Oregon Democrat who has long voiced concern about the markets, told POLITICO that Selig’s CFTC is “moving to create a massive gambling casino that has nothing to do with commodities or hedging.”

Selig is adamant, however: Markets — not gambling — are his job.

“We regulate futures contracts, we don’t regulate gambling,” Selig said. “We’ll continue to do [that] whether the underlying is sports, politics or anything else.”