What happened with the White House review of the CFTC prediction-market rule?

The White House is reviewing a proposed Commodity Futures Trading Commission rule on prediction markets. The filing was received by the Office of Information and Regulatory Affairs on May 26. The review could shape how platforms such as Kalshi and Polymarket operate in the United States.

Why does the CFTC prediction-market rule matter for retail investors and traders?

The proposed CFTC rule matters because it could decide whether prediction markets get clearer federal rules or remain stuck in state-by-state legal fights. For traders, clearer rules could make event-contract platforms easier to access and understand. For platforms, it could affect growth, compliance costs and product launches.

How could the White House review affect Kalshi and Polymarket?

The White House review could help determine whether Kalshi, Polymarket and similar platforms operate under a broader federal framework. That may reduce legal uncertainty if the CFTC gains stronger authority. However, the review does not guarantee that the proposed rule will move forward unchanged.

What are prediction markets and event contracts?

Prediction markets let users trade contracts based on real-world outcomes, such as elections, sports results or public events. Event contracts rise or fall in value depending on whether a specific outcome happens. The debate is whether these products should be treated as federally regulated financial contracts or state-regulated betting products.

Why are some states challenging the CFTC’s authority over prediction markets?

States such as Illinois and New Jersey argue that some sports-related event contracts look like online betting markets. They want to protect state authority over gambling and betting rules. The CFTC and Kalshi argue that federally regulated contract markets fall under commodities law instead.

Cryptocurrency

Image for illustrative purposes only. Not a real photo.

White House weighs CFTC rule as Trump backs federal control

Written by Brie CarterPublished May 28, 2026, 10:16 AM

The White House is reviewing a proposed Commodity Futures Trading Commission rule that could reshape the future of prediction markets in the United States.

The proposal may affect how event-contract platforms such as Kalshi and Polymarket operate as several states challenge the CFTC’s power over the sector.

A federal filing on RegInfo.gov shows that the Office of Information and Regulatory Affairs received the proposed rule on May 26.

The filing was submitted under Executive Order 12866, which covers the review process for major federal regulations before they move towards publication.

The CFTC described the proposal as a rule on “Prediction Markets,” although the filing did not include the full text of the measure.

The review suggests the agency may be preparing a wider federal framework for event contracts after months of legal and political disputes.

Prediction markets allow users to trade contracts linked to real-world outcomes, including sports results, elections and other major public events.

State officials in Illinois, New Jersey and other jurisdictions have argued that sports-related event contracts closely resemble online betting products.

Kalshi and the CFTC have pushed back against that view, arguing that federally regulated designated contract markets fall under commodities law.

The dispute has raised a bigger question over whether prediction markets should face federal oversight or remain subject to state gambling rules.

OIRA, which sits within the Office of Management and Budget, reviews significant rules for possible economic, legal and policy effects.

The White House review comes shortly after President Donald Trump publicly supported the CFTC’s role in supervising prediction markets.

“It is critically important that the CFTC retain exclusive authority over the sector,”

Trump said.

His remarks added political weight to the federal argument at a time when states are trying to protect their own regulatory authority.

The proposal also follows a March advance notice of proposed rulemaking in which the CFTC asked for public feedback on prediction market contracts.

The agency sought comments on whether some contracts should be banned if they are considered “contrary to the public interest.”

The notice specifically pointed to contracts tied to elections, gaming and sports as areas that may require closer scrutiny.

The outcome of the White House review could influence how quickly the CFTC moves towards a formal rulemaking process.

It could also determine whether platforms such as Kalshi and Polymarket gain clearer national rules or face continued state-by-state challenges.

For prediction-market operators, the issue carries major business implications because legal certainty could help them expand across the country.

For state regulators, the proposal may intensify concerns that federal agencies are weakening local control over betting-related markets.

The review does not guarantee that the proposal will move forward in its current form, but it signals that prediction markets have become a federal policy priority.