President Donald Trump's public support for the Commodity Futures Trading Commission's position on prediction markets is unlikely to change the broader legal fight over event contracts, according to investment bank TD Cowen.
Trump said in a Truth Social post Tuesday that it was "critically important" that the CFTC has exclusive authority over prediction markets. The post came as prediction market platforms such as Polymarket and Kalshi continue facing legal cases from several states over gambling-related contracts, with the broader issue being whether event contracts fall under federal commodities law or state gambling laws.
TD Cowen said Trump's support for the CFTC's authority over prediction markets was not surprising.
"We have always assumed that President Trump was backing CFTC Chair Michael Selig's advocacy for prediction markets including his contention that states lack the power to block event contracts on sporting events," Jaret Seiberg, managing director at TD Cowen's Washington Research Group, said in a note on Wednesday. "It was hard for us to see how Selig could so aggressively push for prediction markets without Trump's backing."
Seiberg also noted that Trump's post appeared aimed more at defending Selig following a recent New York Times investigative report into the CFTC's handling of crypto and prediction markets than at materially shifting policy.
