CFTC Chair Rostin Behnam pushed back on Andy Kessler’s column claiming prediction markets are a gambling loophole. He reminded readers that under the Commodity Exchange Act, the Commodity Futures Trading Commission holds jurisdiction over these platforms. The agency argues that a regulated framework shields investors and prevents offshore growth that could aid actors. He also warned that lax rules could erode consumer trust and hamper innovation.

Behnam dismissed claims that insider trading runs rampant in prediction markets, calling them unfounded. He cited the CFTC’s track record of detecting and prosecuting violations, noting that during his first 100 days the commission modernized surveillance tools and filed multiple enforcement actions in the sector. The message is clear: any illicit activity will trigger full legal penalties.

By keeping prediction markets under U.S. oversight, the CFTC aims to preserve market integrity and protect data streams from foreign manipulation. Investors gain confidence that price signals remain trustworthy, while businesses can tap the forecasting benefits without regulatory uncertainty. The commission’s stance signals that the sector will remain domestically anchored rather than drifting to unregulated jurisdictions as well.