Trump publicly expressed his support for Commodity Futures Trading Commission (CFTC) Chairman Michael C. Selig, whom he appointed, and took the opportunity to emphasize his backing for the cryptocurrency industry, calling it an "important industry." He stated, "This is an important industry, and we must protect it."
Additionally, Trump mentioned his campaign promise to make the U.S. the "global cryptocurrency capital," asserting, "Other countries are trying to replace us, but we will not let that happen." Regarding the establishment of industry rules, he noted that his administration is developing "road rules" that will become the "gold standard" for states.
Federal vs. State Authority: Intensifying Legal Disputes
At the heart of the broader debate is whether prediction market contracts related to sports and entertainment are financial instruments or disguised gambling products. The CFTC staunchly defends its "exclusive jurisdiction" over prediction market platforms like Polymarket and Kalshi, and has filed lawsuits against Arizona, Connecticut, Illinois, New York, and Wisconsin to block state-level bans.
In contrast, an increasing number of governors and bipartisan state attorneys general believe that event contract betting, especially on sports events, is essentially another form of gambling and should be regulated at the state level like casinos and lotteries. Minnesota Governor Tim Walz signed a law banning prediction market websites from operating in the state, a groundbreaking legislation that prompted the Trump administration to file a lawsuit to assert CFTC's authority.
In the current regulatory environment, the prediction market industry is experiencing rapid growth, with data from DeFi NewsLlama indicating that monthly trading volume was approximately $792 million in January 2025, and nearing $12.5 billion by January 2026. Trump's remarks came after an investigative report by The New York Times revealed that career officials who raised concerns about Polymarket, Crypto(.)com, and other companies linked to the Trump family were forced out of their positions.