Previously Blocked by Turkey and France: Critical Process in US Congress for 2 Giant Platforms

The US Congress has opened a debate on the CFTC’s authority and the adequacy of existing laws regarding the oversight of rapidly growing sports betting and prediction markets.

As the regulatory battle over prediction markets and sports betting heats up in the United States, the jurisdictional confusion between federal regulators and states has been brought to the Congress agenda. The digital assets subcommittee of the House Agriculture Committee discussed how these next-generation financial instruments should be regulated during a session it held. Lawmakers questioned whether existing laws and the resources of the Commodity Futures Trading Commission (CFTC) are sufficient to manage this massive sector.

Leading platforms in the sector, Kalshi and Polymarket, are drawing attention with valuations reaching approximately $22 billion and $15 billion, respectively. While the CFTC maintains an aggressive stance, arguing that these platforms fall under its jurisdiction, states claim that this violates local gambling laws. Members of Congress are examining whether a legal loophole exists, stating that laws written years ago struggle to respond to today’s evolving technologies and derivative products.

Regulation and Resource Issues in Prediction Markets

One of the most noteworthy topics during the session was the CFTC‘s limited resources. The agency is requesting a $410 million budget for the 2027 fiscal year while attempting to oversee a massive market with approximately 550 employees. For comparison, the Securities and Exchange Commission (SEC) has a much larger capacity with over 4,000 personnel. Lawmakers warned that expanding responsibilities without increasing capacity could create oversight vulnerabilities.

Representative Dusty Johnson emphasized that Congress should not remain silent, noting that courts and the commission have already taken steps in this field. Echoing in the halls of Congress, the heart of the political atmosphere, these discussions aim to establish a clearer legal framework for prediction markets. If current authorities prove insufficient, Congress is expected to initiate a new legislative process to discipline the sector.