#TrumpBacksCFTCAuthorityOverPredictionMarkets Trump Backs CFTC in Escalating War for Control of $10 Billion Prediction Market Industry

Washington, D.C. – In a blistering social media post on Tuesday, former President Donald Trump inserted himself directly into a high-stakes legal battle that could determine the future of the rapidly growing prediction market industry. Trump firmly backed the Commodity Futures Trading Commission (CFTC), declaring that the federal government—not individual states—must hold "exclusive authority" over platforms like Kalshi and Polymarket .

The statement marks a significant political intervention as state regulators and federal agencies clash over whether betting on election outcomes and sports events constitutes illegal gambling or a legitimate financial derivative.

"Scums" vs. The "Gold Standard"

In his characteristic unfiltered style on Truth Social, Trump argued that allowing states to regulate the sector would fragment the industry and stifle innovation. He specifically called out several high-profile political opponents involved in the crackdown.

"It is critically important that the CFTC’s exclusive authority over Prediction Markets is maintained, and that they will thrive," Trump wrote. "Under my leadership, we are setting ‘rules of the road’ that are the Gold Standard for the States" .

He then launched a verbal attack on governors and attorneys general who have moved to ban or restrict the platforms. "We cannot have SCUM like Chris Christie, Letitia James, Tim Walz, and JB Pritzker setting the rules!" Trump posted, referencing officials from New Jersey, New York, Minnesota, and Illinois .

The Core Conflict: Gambling vs. Derivatives

The fight boils down to a fundamental legal question: Are prediction markets gambling or finance?

Currently, the CFTC argues that event contracts are "swaps" or derivatives, falling under the Commodity Exchange Act. This interpretation classifies them as financial products that fall under federal jurisdiction, similar to futures contracts .

However, a growing coalition of states disagrees. Led by figures like Minnesota Governor Tim Walz—who recently signed the nation’s first outright ban on prediction markets—states argue these platforms operate as unlicensed casinos that violate state gambling laws and cannibalize tax revenue from legal sportsbooks .

The Trump administration has already weaponized the federal government in this fight. The CFTC recently filed a federal lawsuit challenging Minnesota’s ban. Furthermore, the agency successfully requested a federal judge to halt a criminal case brought by Arizona against Kalshi, asserting that the CFTC has sole jurisdiction .

The "Trump Trade" and Family Ties

Observers note that the President’s defense of the industry comes with significant financial intersections involving his family.

Trump’s eldest son, Donald Trump Jr. , serves as a general advisor for Kalshi and maintains ties to Polymarket, the platform that famously predicted the presidential election results more accurately than traditional polls . Additionally, Trump Media & Technology Group has launched its own prediction market product .

Trump framed the issue as one of global competitiveness. "Other Countries are after this new form of Financial Market, and we want to remain at the top," he wrote, adding that it is "a major industry, and we must protect it" .

The Road to the Supreme Court

The legal landscape remains chaotic. While the Third Circuit Court of Appeals has sided with Kalshi against New Jersey regulators, a potential ruling from the Ninth Circuit against the platforms could create a "circuit split," almost guaranteeing a Supreme Court showdown .

For now, the industry is betting on Trump. Following his post, analysts noted that the political pressure on state-level crackdowns has intensified, with the White House signaling that it views the $10 billion-a-year industry as a pillar of modern financial markets rather than a vice .