Filling Out The Roster
The CFTC typically runs with five commissioners, but right now there is only one. Are more nominees on the way?
The Bulletin Board
THE LEDE: Are more CFTC Commissioner nominees on the horizon?
NEWS: Goldman Sachs CEO talks prediction markets during Q4 earnings call.
VIEWS: Don’t dismiss federal action.
AROUND the WATERCOOLER: Offshores not impacted by prediction markets.
STRAY THOUGHTS: A Quote of the Week from NY State Sen. Joseph Addabbo.
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The Lede: Will the Trump Admin Add More CFTC Commissioners?
It’s supposed to be a five-member band, but the Commodity Futures Trading Commission (CFTC) has been performing a one-person show for most of the Trump Administration.
That could be changing.
As Bloomberg’s Lydia Beyoud reported earlier this month: “The White House is considering a bipartisan slate of nominations for the Commodity Futures Trading Commission, including Matt MacKenzie, Bill Rockwood, and Ari Officer for Democratic commissioner positions.”
The possibility of President Trump filling several of the vacant CFTC spots has been bandied about before. As I highlighted in October when recently confirmed CFTC Chair Mike Selig’s name first came up, CoinDesk noted Trump might fill more than one commissioner slot:
“Former CFTC Chairman Chris Giancarlo… said the White House is vetting CFTC candidates beyond the chairmanship. Without a slate of commissioners, whoever takes over from Pham would be alone at the commission, which is meant to have five members by law. Policies instituted by a single-member commission could be vulnerable to legal challenges.”
Former CFTC General Counsel Rob Schwartz called the potential filling of vacant CFTC slots “important and good governance,” in a tweet on January 8.
As Schwartz noted:
“The Commodity Exchange Act directs the President to nominate individuals with ‘demonstrated knowledge in futures trading or its regulation, or the production, merchandising, processing or distribution of one or more of the commodities’ covered by the statute and ‘seek to ensure that the demonstrated knowledge of the Commissioners is balanced’ in those areas. That means agriculture, energy, raw materials, financial products and measures, crypto, event contracts, and on and on and on.
“One person cannot and should not be required to do it alone. It will be good to get back to normal business at the Commission.”
As Schwartz notes, one person cannot be expected to handle everything at an historically understaffed regulatory body that is seeing its mandate greatly expanded by crypto and prediction markets.
Still, there are several questions about the possibility of reinforcements:
Will the administration actually put forth nominations?
Who will those nominations be?
Will those nominations get confirmed in a midterm election cycle?
How long will the process take?
News: Goldman Sachs CEO Talks Prediction Markets
Goldman Sachs CEO David Solomon responded to a question about prediction markets during the company’s Q4 earnings call last week, saying he has “personally met with two big prediction companies and their leadership in the last two weeks and spent a couple of hours with each, to learn more about that.” While left unnamed, Solomon most likely was referring to Kalshi and Polymarket.
Solomon noted that while some of the prediction market offerings look like derivatives, and that the company is focused on understanding where there might be “opportunities where these cross into our business,” he also pumped the brakes, saying:
“There’s a lot of reason to be excited and interested in these things, but the pace of change might not be as quick and as immediate as some of the pundits are talking about in both these. But I think they’re important, real, and we’re spending a lot of time.”
He also noted the firm’s interest in tokenization and stablecoins, and the ongoing discussion in Congress on the Clarity Act — which saw talks blow up last week.
Per Solomon:
“I don’t think we have to be the leader, but it would not surprise you that we have a big team of people spending a lot of time with senior leadership and doing a lot of work so that we can clearly decide where we’re investing in playing and how those technologies can expand or accelerate a variety of our existing businesses. And where there are new business opportunities candidly around those technologies.”
While more about crypto, the American Gaming Association (AGA) and Indian Gaming Association (IGA) were urging Congress to add a sports contract prohibition to the Clarity Act before talks went south.
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Views: Everything Is NOT Fine
Yesterday I mentioned the industry was in a narrative battle, and I want to expand on that today.
There are a lot of bright shiny objects holding everyone’s attention, but sitting (somewhat) quietly in the background are ongoing efforts to rein in online gambling.
It’s happening at the state level (tax hikes, prop bet bans, and advertising restrictions), and while plenty of people disagree with me on this, there are serious rumblings at the federal level that would be unwise to ignore, including the SAFE Bet Act and a recently proposed prop betting ban.
While I don’t think these federal efforts have much of a chance (particularly in 2026), they do have a chance.
More importantly, as I’ve said in the past, legislative efforts don’t have to pass to have an impact:
“As STTP often warns, these bills don’t have to pass to have an impact. The mere existence of these efforts will impact and shape policy in other states. We’re already seeing SAFE Bet Act policies show up in state bills, and even though only a few have passed, new legislation is skewing towards higher tax rates and less promotional deductions since states began discussing tax rate increases.”
And as I wrote for Casino Reports in September 2024:
“The SAFE Bet Act will continue to be a constant threat. The people pushing for these restrictions and prohibitions (and I’m not talking about the lawmakers) aren’t going to give up. RAWA was never enacted, but it effectively held up legislation at the state level for many years.”
Over the past year or two I’ve been told many times, publicly and privately, how wrong my analysis is on a whole host of issues (big and small), and only once has one of those people later come back and said I was right. This isn’t a brag; I get things wrong, too. I’m simply pointing out that some of the loudest voices believe the industry has more control over the narrative than it actually does.
As I noted in April 2024, the narrative is slipping away:
“To say the industry has lost the plot is an understatement. But I’m not surprised. Unless it’s trying to expand gambling in a new market, the industry is rarely proactive. With most things, it’s reactionary and tends only to interact when absolutely necessary – when the train has already gone off the rails.
“When there is negative press, the industry buries its head in the sand or pushes back with cries of being mischaracterized, falsely accused, or conflated with offshore bookies. And any communication is always delivered in corporate PR speak.
“But as I’ve previously said, arguing back and forth is a road to nowhere.
“Both sides have their own data and reports to point to, and I’ve yet to come across someone who has gone from anti-gambling to pro-legalization.
“The industry needs to pick its battles and go on the offensive, admit (gasp!) that gambling does cause social harm, and regain control of the narrative because, at the moment, it’s primarily seen as a self-serving entity with one thing on its mind: money.”
And as I said after the Shane Gillis Saturday Night Live skit poking fun at sports betting that aired nearly two years ago (you can watch Rock Bottom Kings here):
“The SNL skit is the latest example of the industry letting the press, social media, comedians, and commentators control the narrative.
“Whether it’s coverage by the New York Times, Wall Street Journal, 60 Minutes, or ESPN, the industry is letting a narrative develop and then pushing back against it.
“That’s a bad strategy. There’s a saying in self-defense circles: whoever starts it usually finishes it.”
If the industry doesn’t regain control of the narrative (scandals, athlete harassment, social harms) and prediction markets keep pushing the envelope, these types of arguments are going to land harder:
Around the Watercooler
Social media conversations, rumors, and gossip.
What impact are prediction markets having? Alfonso Straffon has some anecdotal evidence:
Of course, as I noted the other day, cannibalization can take time to show up.
Stray Thoughts
“I support Governor Hochul’s proposal to protect minors from gambling via mobile sports betting… I am hopeful Governor Hochul expands on her own vision to protect minors from mobile sports betting and works towards doing the same by legalizing and regulating iGaming in New York.” ~ New York State Senator Joseph Addabbo Jr.