The new chair of the Commodity Futures Trading Commission (CFTC), Michael Selig, has announced plans to future-proof the agency, signalling softer oversight of cryptocurrency and prediction markets.
In a column for the Washington Post, Selig suggested he would seek to upgrade the authority, which he suggests is relying on decades-old rules and regulations unfit for modern implementation.
Prediction market worth trillions, says Selig
It is clear Selig believes strongly in the prediction markets industry and feels it will form a backbone of the economy moving forward, despite some critics urging for more government regulation.
The new CFTC figurehead posted on X on January 20, 2026: “Prediction markets have exploded in popularity as participants seek to hedge risks and test their abilities to forecast truth.”
In his Washington Post column, he reiterated the need to cut the red tape around the financial markets. He said: “To achieve the golden age of American financial markets, as the president might call it, regulators must break with the rigid and restrictive regulatory practices of the past.
“The CFTC will seize this generational opportunity to modernize and future-proof its approach to regulation and ensure that the great innovations of today and tomorrow are made in America.”
A lawyer by training, Selig previously worked in senior regulatory roles at the Securities and Exchange Commission, including advising on digital assets, and later practiced law focused on financial markets and derivatives. He was nominated to lead the CFTC by President Donald Trump in October 2025, confirmed by the Senate in December and sworn in later that month
Prediction markets get apparent nod from Goldman CEO
Prediction market platforms, like Kalshi and Polymarket, have seen an astronomical surge in popularity over recent months. A recent 2025 industry report from research firm Eilers & Krejcik projects the U.S. could eventually generate as much as $1 trillion in annual trading volume once fully developed.
Much of the focus has been on sports event betting contracts and how they undercut legal, regulated sports betting operators. However, there is a growing belief that prediction markets could be used as an instrument by traders on Wall Street.
That belief is further enforced by Goldman Sachs CEO David Solomon who recently referred to the sector as “super interesting” in a comment during the Goldman Sachs Group, Inc. fourth-quarter earnings call.
The response was swift, with analysts speculating on how major financial institutions might appropriately integrate and commercialise prediction markets. Solomon’s remarks pointed to a move away from viewing such platforms as betting venues and toward treating them as a form of derivatives trading, a shift that suggests Goldman Sachs is exploring ways to incorporate event-based contracts into its broader institutional operations.
Former commissioner wants more guardrails
While Selig is optimistic on the future of prediction markets, the ex-commissioner was sounding alarms before stepping down last year.
Speaking at the Brookings Institute in August last year, Commissioner Kristin N. Johnson warned: “As of today, we have too few guardrails and too little visibility into the prediction market landscape. There is an urgent need for the commission to express in a clear voice our expectations related to these contracts.
““The stakes are high. And, if I only have one piece of wisdom to share, it would be the following: get it right. Measure twice, cut once.”
Johnson announced in May 2025 that she would be leaving the agency after completing her three-year term. Her departure was tied to the natural end of her duration in the role and her stated intent to step down and return to academia after serving as a regulator; she had been nominated by President Biden and confirmed by the Senate in 2022.
Former CFTC Chair Rostin Behnam has also previously sounded caution over prediction markets, especially in relation to election betting.
Prediction markets facing legal battles across the country
Several states have already blocked or limited certain types of prediction market contracts, citing concerns about unlicensed betting operations.
Massachusetts recently became the latest battleground, when a federal judge ruled that Kalshi could not offer sports-related contracts in the state. Other platforms, including Polymarket, have faced investigations or warnings from state regulators questioning whether their contracts fall under securities or derivatives laws.
Selig’s plans could ease regulatory hurdles for prediction market platforms, allowing faster innovation and a wider range of contracts. Users may benefit from more options and lower fees, while the CFTC maintains key safeguards to ensure market integrity.
However, there remains pushback from state governors and institutions, who believe it’s a sector that is allowing unregulated betting to fester. How Selig and his team navigate this landscape could shape the future of American financial markets.
