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Trump Backs CFTC as U.S. States Escalate Prediction Market Fight

Trump Backs CFTC as U.S. States Escalate Prediction Market Fight

President Trump said the CFTC should retain exclusive authority over prediction markets as states intensify gambling-law challenges, deepening a jurisdictional clash with implications for crypto-linked platforms.

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Fact Check
Multiple independent X sources reporting nearly simultaneously on 2026-05-26 (Watcher.Guru, Bitcoin Magazine, Pete Rizzo, Disclose.tv, Crypto Briefing, Ash Crypto) consistently quote Trump saying other countries are trying to replace the US as the Bitcoin/crypto 'capital of the world' and that 'it is a major industry, and we must protect it.' Several sources describe this as a Trump post (likely Truth Social). The statement is fully consistent with Trump's documented prior policy positions reflected in the White House fact sheet on the Strategic Bitcoin Reserve, which uses identical 'crypto capital of the world' language. The claim's wording accurately summarizes the reported statement.
Summary

President Trump said it is "critically important" for the Commodity Futures Trading Commission to keep exclusive authority over prediction markets, backing CFTC Chair Michael Selig as the agency fights states over whether event contracts are federally regulated derivatives or gambling products under state law. The dispute affects platforms including Polymarket, Kalshi, Robinhood and Crypto.com and has broader relevance to crypto-linked markets because some prediction-market models use blockchain-based infrastructure or tokenized settlement. The report says the CFTC has sued five states; one account names New York and Illinois among them, while another lists Wisconsin, Illinois, Arizona, Connecticut and New York. State resistance has expanded through a 39-state attorneys general coalition supporting Massachusetts against Kalshi’s sports contracts, Minnesota’s new criminal penalties for operating prediction markets, and congressional scrutiny of Kalshi and Polymarket over insider trading concerns. Trump also repeated that the United States is the capital of Bitcoin and other crypto assets. No legal resolution or new federal policy action was announced, and court watchers cited in the report expect the fight could reach the Supreme Court within 12 to 18 months.

Terms & Concepts
  • CFTC: The Commodity Futures Trading Commission is the U.S. regulator that oversees derivatives markets, including certain commodity-related and event-based contracts.
  • Prediction markets: Platforms where participants trade contracts based on the outcome of future events, often structured as event-based or regulated financial contracts.
  • Federal preemption: A legal principle under which federal law overrides conflicting state law, central to the CFTC’s argument that states cannot block federally regulated event contracts.