CFTC Adds Prediction Markets to Advisory Agenda

he U.S. regulator for futures and derivatives has created a new advisory body to help shape how prediction markets and emerging financial technologies evolve in the coming years. The Commodity Futures Trading Commission has formally launched the Innovation Advisory Committee under chairman Michael Selig.

Good to Know

• CFTC renamed its former Technology Advisory Committee to Innovation Advisory Committee to broaden its remit.
• The panel will advise on prediction markets, AI, blockchain, cloud, and other tech impacts on markets.
• CEOs from prediction market platforms including Polymarket and Kalshi are among initial figures connected to the committee.

What the CFTC Innovation Advisory Committee Will Do

CFTC chairman Michael Selig has shifted focus to bring more perspectives into how the agency considers new financial products, platforms, and market structures. His Innovation Advisory Committee replaces the earlier Technology Advisory Committee and carries a broader scope that includes prediction markets alongside other technologies like blockchain, artificial intelligence, and cloud computing. The committee’s goal is to gather practical and economic input from a range of voices inside and outside the financial system.

Under the new structure, Selig plans to nominate members and then open portions of the process to public nominations. The IAC is set up to advise the CFTC on commercial, economic, and real world considerations for emerging market offerings. It will also feed insights into how the agency might update surveillance and enforcement tools so they work with newer technologies rather than lag behind them.

Early involvement from industry leaders bridges regulated financial firms, crypto firms, and prediction market platforms. CEOs of firms such as Polymarket and Kalshi are connected to the initial charter group, along with leaders from Gemini and other markets, offering insights directly where innovation meets regulatory oversight.

Why Prediction Markets Now?

Concern from lawmakers has played a role in the timing of the committee launch. A group of twelve U.S. senators, led by Catherine Cortez Masto, recently sent a letter to Selig questioning how prediction markets are regulated.

The senators pointed to trading activity linked to reports surrounding Venezuelan President Nicolas Maduro. They cited spikes in volume ahead of public announcements and contracts tied to sensitive geopolitical events. Lawmakers argued those examples raise risks around insider trading and manipulation, especially compared to safeguards already used in regulated sports betting.

As reported earlier at iGaming.org, concern does not stop at Capitol Hill. Two major industry bodies, the American Gaming Association and the Indian Gaming Association, urged Congress to address sports related event contracts as part of upcoming crypto market legislation.

The groups argued that sports event contracts often resemble sports betting products while operating outside many of the rules applied to licensed sportsbooks. They also noted that attorneys general from thirty nine states have agreed prediction markets tied to armed conflict or terrorism would not be permitted under existing sports betting law.

The Innovation Advisory Committee now serves as a formal channel for gathering expertise across these issues, with the stated goal of helping the CFTC shape clearer rules for the future of prediction markets.

FAQ

What will the Innovation Advisory Committee focus on?

It will provide recommendations on new technologies, products, and platforms shaping financial markets, including prediction markets, AI, and blockchain.

Who is included in the committee’s early phase?

Industry leaders from prediction market firms such as Polymarket and Kalshi, and other financial and tech segments are linked to the initial advisory structure.

Why does prediction market oversight matter?

Lawmakers and industry stakeholders have voiced concerns about legal status, reporting standards, and lack of monitoring compared to other regulated markets.

Meta Description (140 characters)

CFTC has launched an Innovation Advisory Committee to guide regulation around prediction markets, AI, and fintech, including input from Polymarket and Kalshi.