The Bulletin Board
THE LEDE: Will the CFTC restrict sports contracts in its rules?
BEYOND the HEADLINE: A familiar question about the CFTC’s capabilities.
ROUNDUP: A look at the stories you may have missed.
HAPPENING TODAY: Indian Gaming Association discusses prediction markets.
AROUND the WATERCOOLER: The Lodge saga is over.
STRAY THOUGHTS: When theory runs into reality.
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The Lede: CFTC PM Rules Are Coming, But How Far Will They Go?
The public comment period for proposed rules around prediction markets is set to close on April 30, and let’s just say there are a lot of words to pore over, with nearly 1,200 comments submitted.
And CFTC Chairman Michael Selig (a prediction market booster if there ever was one) opened the door to real restrictions.
As reported by Front Office Sports, “He didn’t rule out changes that could include restrictions or even prohibitions on markets that mirror prop bets or parlays, ‘but that has to be done through rulemaking.’”
“We’re not going to, by staff discretion, decree this product is valid and this one’s not,” Selig went on to say. “We’re not a merit regulator. Our job is not to tell people in a paternalistic way ‘you can trade this but not that.’”
Recent podcast guest Charles Fain Lehman pointed out on X that a merit policeman is exactly what the CFTC is supposed to be, and doing so would help preserve prediction markets in the long run:
“CFTC is, statutorily, a merit policeman that picks and chooses which contracts people should or should not be able to trade… as I was saying, prediction markets are not actually being helped by a regulator uninterested in enforcing the statute. In fact, CFTC doing so would help preserve their very real benefits!”
These remarks were surprising to hear from the lips of Selig, but not overly surprising if you’ve been paying attention to the legal battles taking place and the increased scrutiny these markets are receiving, even getting an off-the-cuff response from the President.
As Straight to the Point has repeatedly said, prediction markets are shaping up to be a flashpoint issue in the upcoming midterms; a microcosm for “larger systemic issues: Corruption, pay-for-play, laissez-faire regulation, and out-of-control tech bros.”
The best way to deal with that would be to concede some ground (there is a secondary reason the CFTC might cede some ground, which I lay out in the Beyond the Headline section below). The larger questions are, how much ground will it concede, and could that possibly be enough to appease commercial sportsbooks, tribes, and states to drop the lawsuits?
As I reported earlier this week, this (player props and other markets) could be the grand bargain:
“[CNIGA Chairman James] Siva went on to opine that the administration may be willing to trade sports contracts for crypto concessions: ‘In fact, I think that’s actually the play here from this administration, which wants cryptocurrency to be regulated, but not by the [U.S. Securities and Exchange Commission]. They want it regulated under the CFTC. They want their crypto bill. I don’t think the administration actually cares about sports event contracts.’”
And as I’ve been saying all along, the end result might be limited sports contracts at prediction markets (tentpole events or even contracts on individual games in major sports).
Beyond the Headline: Can a Shrinking CFTC Oversee Nationwide Sports Betting?
This is a question Straight to the Point has been asking since the first inklings of sports contracts appeared: Does the Commodity Futures Trading Commission (CFTC) have the capability to oversee nationwide sports betting? And related, does it want to?
Attorney Andrew Kim discussed this in April 2024 on the podcast:
And as I wrote in May 2025, the CFTC has long complained it is understaffed to deal with its main objective of overseeing the multitrillion-dollar swaps market (the US swaps market’s notional value is likely $250–350 trillion, while bull-case estimates put sports contracts at just over $1 trillion): “No matter how on board the CFTC is with sports contracts, one has to wonder if it’s equipped or has the appetite to handle it.”
Is it any wonder that an understaffed regulatory body with next to zero experience overseeing sports betting wants the prediction markets themselves to be the first line of defense, as CFTC Chair Michael Selig said (here and here)?
As I wrote earlier this month:
“The CFTC also has close to zero experience with sports betting. Gaming regulators (casinos, lottery, racing) struggled with it initially, so I can only imagine what the learning curve will be for someone whose expertise lies in interest rate swaps and agricultural commodities… Is it prepared to double its workforce to oversee sports contracts, which at the top-end will be a rounding error of the $300 trillion in trades it oversees?”
Which brings me to a recent CNN article:
“While prediction markets are booming – allowing anyone to bet on nearly everything from sports to elections to who’s going to win season 50 of “Survivor” – the little-known federal agency that regulates the industry has shrunk to its smallest size in 15 years.”
As CNN noted, “The Commodity Futures Trading Commission workforce has dropped by 24% since President Donald Trump returned to office,” with enforcement attorneys hard hit, all while prediction market usage is exploding, and so are the incidents of insider trading and the listing of controversial markets.
The CFTC currently has about 535 employees. In its 2025 budget the CFTC requested funding for 725 employees. Selig requested funding for 650 full-time jobs, but as CNN reports, “After a year of DOGE’s layoffs, buyout offers, and early retirement incentives, the agency shrank to 535 by February.”
“They’re going to have a lot of work to do, and they are going to have to triage,” the former CFTC official told CNN. “Some stuff will go unaddressed. They won’t be able to pursue as many matters as they would’ve at full strength.”
“I personally experienced that staffing needs often dictate what is prioritized and what is not,” said Noah Solowiejczyk, a former federal prosecutor who worked with the CFTC on financial cases, told CNN. “There are real questions as to whether they have enough staff in enforcement to really handle this issue.”
All of that points to sports contracts being toward the bottom of the priority list, and why the CFTC might (stress, might) impose rules prohibiting easily manipulable sports contracts (like player props) that would increase the agency’s workload exponentially, and are also the cause of a great debate.
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Roundup: So Much News; So Little Newsletter Space
DraftKings Super App just got more super [Press Release]: “DraftKings announced “DraftKings Racing,” the company’s previously announced new horse racing feature, is now available in an additional six states ahead of the Kentucky Derby following its launch in Delaware, New Mexico and Rhode Island. Recently added states include Florida, Louisiana, Montana, New Hampshire, Ohio and Oregon. DraftKings Racing is a key step in the company’s broader vision for its Super App, ‘DraftKings Sports & Casino,’ which will bring together Sportsbook, Predictions, Casino, and Lottery into one unified experience, with access tailored by jurisdiction.”
EKG report estimates Nebraska mobile betting tax impact [Nebraska Examiner]: A petition to put mobile sports betting on the November ballot is circulating in Nebraska, and “New research commissioned by a group petitioning to legalize online sports betting in Nebraska found that doing so could generate just under $87 million in new state tax revenue over five years. Assuming that 70% of generated revenues would be distributed as property tax credits, the same as for voter-approved casino gambling, this could translate into roughly $61 million in additional tax relief over the same period, independent research firm Eilers & Krejcik Gaming found.”
Torch Electronics pulls VGTs from Missouri [St. Louis Public Radio]: While it appeals a district court ruling, “Wildwood-based Torch Electronics is suspending operations of the devices, which resemble slot machines,” Missouri Attorney General Catherine Hanaway said. “A federal judge has ruled the devices, found in bars, convenience stores and fraternal organizations, are illegal gambling machines. The company is in the process of appealing U.S. District Judge John Ross’ ruling. Torch Electronics spokesman Gregg Keller declined to comment Wednesday about the company’s plans for the machines.”
Star college QB checks into gambling rehab [ESPN]: “Texas Tech transfer quarterback Brendan Sorsby, one of college football’s top returning players, is checking into a residential treatment program for a gambling addiction, the school announced Monday. Sorsby’s decision to seek treatment, according to sources, came in the wake of the discovery of Sorsby making thousands of online bets on a variety of sports via a gambling app, which jeopardizes his eligibility with Texas Tech. The NCAA is investigating Sorsby’s gambling, according to sources, as the organization forbids athletes from betting on both college and pro sports.” According to USA Today, Cincinnati (his previous school) was alerted to Sorsby’s betting prior to the 2025 season.
NBA Commissioner confirms previous reports of talks with prediction markets [Bill Speros, X]:
DAZN applies for NFA membership [InGame]: “Sports streaming platform DAZN could be set to offer prediction market contracts in the U.S. soon, from an exchange like Polymarket U.S., after it applied to join the National Futures Association (NFA) as an introducing broker. DAZN applied for membership under the name Sports Marketing 1 LLC, which is owned by its DZBT Malta subsidiary, which runs the DAZN Bet platform in Europe. The application, filed April 21, lists DAZN’s London headquarters as its business address.”
Resorts World becomes New York City’s first full-fledged casino [ABC 7]: Resorts World launched its table games on Tuesday, making it the first full casino in New York City. “A ceremonial first toss of the dice kicked off the grand opening on Tuesday… The milestone is the first part of a $5.5 billion investment that includes future plans of a $2 billion community benefits package, a 7,000-seat multipurpose entertainment venue, and building up to 50,000 units of workforce housing. Casino owners say that more than 1,200 new jobs have been created, including 950 new table-game dealers. The casino plans to have more than 2,700 employees by summer.” As I said recently, “Resorts World, an existing racino, will have a huge jump on its two competitors, who will need to build their properties from nothing.”
Happening Today: New Normal Webinar Talks Prediction Markets
The Indian Gaming Association’s (IGA) The New Normal webinar series will once again be tackling prediction markets. Today’s episode (you can register here) is called: Super PACs, Prediction Markets, and the Battle for the 2026 Midterms.
Hosts Victor Rocha, IGA Conference Chairman, and Jason Giles IGA Executive Director, will be joined by IGA Chairman David Z. Bean, and Holly Cook Macarro, Principal The Angle.
Here is the description of the webinar:
“Prediction markets and political money are converging in ways that could reshape the 2026 midterm elections. Super PACs like Fairshake PAC and Win For America PAC are deploying significant capital to influence key races, policy outcomes, and the regulatory environment. At the same time, prediction market operators and crypto-backed platforms are pushing deeper into political and event-based contracts, while members of the Sports Betting Alliance continue to fund state-by-state expansion efforts. These forces are not operating in isolation. They are advancing in parallel, with capital, technology, and policy pressure moving in the same direction.
”For tribal gaming, the implications are direct. It is like the future of tribal gaming is at stake, because it is. This is not just about new products entering the market. It is about how influence is being applied to elections, how legal frameworks are being tested, and how authority could shift outside of existing compact and regulatory systems. As these efforts accelerate, the risk is that decisions impacting tribal gaming are shaped without tribal participation or consent. This episode of The New Normal examines where that pressure is coming from, how it is being applied, and how to fight back.”
STTP wrote about tribes and prediction markets in yesterday’s newsletter:
Around the Watercooler
Social media conversations, rumors, and gossip.
It’s been a long six weeks for The Lodge Card Club, which was raided on March 10 and forced to shut down, but there is now light at the end of the tunnel.
I’d still caution that the legality of these poker rooms is an open question. As I wrote in March, paraphrasing two-time podcast guest Andrew Kim (Episodes #48 and #66), their legality is built on quicksand.
Stray Thoughts
In martial arts you will run into two types of people: Theorists and Realists.
Examples of Realists are the former doorman or an MMA fighter. They have a really good idea of what works (one from a self-protection standpoint and the other from a combat standpoint). Theorists, on the other hand, spend years studying (collecting) techniques, but rarely pressure-test them in live sparring, let alone in a bar or the cage.
Realists spot things before they happen. Theorists wait until something happens, freeze time, dissect the attack and then explain what you should do.
What’s interesting to me is that Realists tend to have a solid grasp on the theory, but Theorists rarely have a solid grasp on reality.
I would posit that the same split and disconnect can be seen in the gambling world; there are a lot of theorists running around that are disconnected from reality.