Gary Gensler, former chair of the Commodity Futures Trading Commission, joined the Chicago Mercantile Exchange this week in opposing the expansion of prediction markets. The regulatory dispute centers on whether federal agencies should oversee sports event contracts across US jurisdictions.
Regulatory Scope and Legal Challenges
Gensler discussed the issue during the Indian Gaming Association’s New Normal webinar on Wednesday. On 11 June, he filed an amicus brief supporting Ohio in its lawsuit against Kalshi. He argues that sports event contracts do not qualify as financial swaps and that the CFTC lacks the capacity to manage nationwide betting operations. Gensler noted that classifying these contracts as swaps would render all state and tribal sports wagers placed over the past decade technically illegal.The swap classification question also influenced a recent Nevada ruling. Carson City District Court Judge Jason Woodbury initially issued a preliminary injunction against Kalshi before reversing the decision. That matter remains the only recorded instance of a court halting trading within a specific jurisdiction.
Gensler stated, "I chose to speak up … as a friend of the court to say, 'What were we all doing [at the CFTC] back then, and what were we not doing back then?' And by the way, unambiguously, we were not trying to have a federal regulator regulate sports betting."
Gensler previously led the CFTC from 2009 to 2014, overseeing the agency through the Dodd-Frank Act of 2010, and later served as SEC chair from 2021 to 2025.