Digital Chamber Launches Group to Boost Prediction Markets Regulation
The Digital Chamber, a prominent blockchain advocacy organization, has established a dedicated initiative aimed at bolstering prediction markets and securing clearer regulatory guidelines for this industry within the United States.
In a recent announcement shared on X this Tuesday, The Digital Chamber introduced the Prediction Markets Working Group. This group has outlined an extensive multi-year strategy to address what it describes as a frequently misunderstood area within the financial landscape.
As its initial step, The Digital Chamber dispatched a formal letter to Mike Selig, the chairman of the Commodity Futures Trading Commission. The letter commended his commitment to upholding federal oversight of prediction markets and urged an immediate halt to the practice of regulation through enforcement actions.
“In our correspondence, we expressed strong support for Chair Selig’s latest remarks on the CFTC staff’s plans to deliver customized rulemaking and guidance tailored to this swiftly expanding sector of the financial and digital asset markets,” stated The Digital Chamber.
“Operators in this field have endured prolonged uncertainty, grappling with a complex web of regulatory vagueness, including ambiguous boundaries between federal and state authorities,” the organization further noted.
Looking ahead, the working group intends to sustain ongoing dialogue with the CFTC, formulate core policy principles, offer detailed policy suggestions, release in-depth research reports, and cultivate a broad alliance comprising industry leaders, stakeholders, and active participants.
Additionally, the group has committed to involvement in legal proceedings by submitting friend-of-the-court briefs. These efforts are designed to inform judicial bodies about the CFTC’s longstanding and exclusive regulatory authority over the prediction markets domain.
Prediction Markets Face Heightened Legal Challenges
This development occurs against a backdrop of escalating attention from state governments and regulatory bodies targeting the prediction markets sector.
Kalshi, a frontrunner among prediction market platforms, encountered a civil enforcement measure from the Nevada Gaming Control Board on Tuesday. The board is seeking a court injunction to prevent Kalshi from providing what it terms “unlicensed wagering” within Nevada’s borders.
Both Kalshi and its rival Polymarket have faced repeated interventions from various state regulators attempting to prohibit them from offering markets like sports-related contracts. These regulators contend that such offerings constitute unlicensed gambling activities.
Just last week, Polymarket initiated a federal lawsuit against Massachusetts. The suit aims to preempt any forthcoming enforcement by asserting that the CFTC holds primary jurisdiction over prediction markets, superseding state-level control.
The CFTC chairman has voiced similar views in recent statements, pressing state governments to acknowledge the commission’s authority and supervisory role over this sector—or prepare for courtroom confrontations.
“Prediction markets are not a novel concept—the CFTC has overseen these markets for more than two decades,” Selig underscored in a video shared on X this Monday.
In response to Selig on Tuesday, Utah Governor Spencer Cox indicated openness to potential legal disputes with the CFTC. He characterized prediction markets as outright gambling, warning that it “devastates the lives” of countless Americans.
“Mike, I respect your effort to present this earnestly, but I don’t recall the CFTC claiming authority over the ‘derivative market’ for LeBron James rebounds. The prediction markets you’re so eagerly championing are gambling—plain and simple.”
