The Commodity Futures Buying and selling Fee (CFTC) has come out to defend the federal unique jurisdiction over crypto prediction markets like Polymarket.
The corporate has achieved this by intervening within the Crypto.com case in Nevada, the place regulators are looking for to ratify that future occasion contracts are regulated monetary merchandise and never video games of likelihood that require a regional license. By definition, a future occasion contract is a straightforward monetary by-product that settles if a specific market (index, product) reaches a “sure or no” situation inside a predetermined time.
This technical distinction, protected by the Commodity Alternate Act, is meant to quell authorized assaults by states looking for to impose their very own playing legal guidelines on platforms with federal oversight.
In an opinion column revealed on February 16, 2026, the company’s director, Michael Selig, ditched his standard bureaucratic language to state his place. In it, he warned that the CFTC would now not be a bystander to state makes an attempt at prohibition. Merchandise thought of by authorities to be official danger administration instruments.
“The CFTC will now not stand by and watch overzealous state governments undermine our unique jurisdiction by looking for to determine bans on these merchandise.”
Michael Selig, CFTC Chairman.
Moreover, on February 5, 2026, the company filed a movement to grant briefs with the court docket (pal of the court docket (or by individuals near the court docket) to help Crypto.com (North American Derivatives Alternate) in america Court docket of Appeals for the Ninth Circuit in litigation in opposition to Nevada regulators.
Traces of this intervention That is the primary time the CFTC has taken direct motion in one in all about 50 pending state lawsuits in opposition to the alternate. and federally registered cryptocurrency platforms.
The crux of the dispute lies within the very nature of those contracts. Though they’re categorized as video games underneath playing legal guidelines in states corresponding to Nevada, Selig argues they serve an necessary financial perform.
The company says these markets assist farmers defend themselves from temperature fluctuations that may break crops, and small enterprise homeowners defend themselves from increased taxes and better power costs. These monetary devices remodel unpredictable dangers into manageable and predictable prices, enhancing financial resilience.
Authentic financial perform by predictive contracts
Temperature adjustments are excessive occasions corresponding to frost, drought, warmth waves, and extreme rainfall that may injury agricultural manufacturing. Additionally, in agricultural derivatives (futures and choices on exchanges corresponding to CME, CBOT, and ICE Futures), farmers promote futures or purchase choices to set a minimal promoting value.
If a climate occasion causes crop yields to say no and costs to rise as a consequence of lowered provide, the manufacturing loss can be compensated for by beneficial properties on derivatives, stabilizing revenue.
In that sense, there may be Elementary adjustments in US regulatory coverage. That is as a result of the brand new CFTC administration is dismantling boundaries put in place by its predecessor, rescinding a 2024 proposal that referred to as for a ban on political and sports activities contracts and a 2025 employees suggestion that warned of authorized dangers for states.
As an alternative, Selig argued that platforms corresponding to Calci, Polymarket and Coinbase function underneath strict federal oversight and don’t classify these merchandise as video games of likelihood. Mr. Selig, who was appointed president on December 22, 2025, directed his employees to reevaluate their involvement within the litigation to guard their unique jurisdiction.
Authorities businesses put together new guidelines to make clear regulatory framework and encourage accountable innovation within the occasion market that integrates cryptocurrencies and real-world predictions.
As CriptoNoticias not too long ago reported, the CFTC has expanded its Innovation Advisory Board to 35 members, which additionally consists of leaders from Coinbase and Polymarket. The growth, introduced on February 12, 2026, will embody Brian Armstrong (CEO of Coinbase), Shayne Coplan (CEO of Polymarket), and different executives from crypto platforms and prediction markets, in addition to representatives from conventional finance (corresponding to CME Group and Nasdaq) and lecturers.
The transfer strengthens the CFTC’s pro-cryptocurrency strategy underneath Selig. Thus far, no fast regulatory adjustments have been introduced. If the committee begins to sign that it’s going to result in clear requirements for these merchandise.
