00:00Sam, in looking for some new clarity, the other day, we seemingly did not get any.
00:05The new CFTC chairman essentially passing the buck a little bit, saying that, hey, we're going to let the courts handle things.
00:15And certainly, I don't know which way this is going to go.
00:17But the longer that everybody just keeps pushing these stories to the side, it seems like prediction markets are here to stay.
00:26Yeah, I would agree with you, Craig.
00:27That's the top line takeaway.
00:29The more uncertainty we have around the fate of prediction markets, who will decide them mainly, the longer they ramp up their investment, their legitimacy through deals with the NHL, with X, with the New York Stock Exchange.
00:44They have more time to gain mind share in the general public's eyes as well.
00:50We certainly see ads everywhere, and these companies are getting more and more investments by the day.
00:55But kind of the big news this week is that Michael Selig, who is the chief counsel of the SEC crypto task force, he's Trump's nominee to lead the CFTC, which is largely devoid of leadership right now.
01:08They only have one of five acting chair seats filled.
01:11And one of those chair seats is actually on the way out in about a month as well.
01:16So his timing comes with the Senate confirmation hearing later this week in front of the full Senate, where everyone's kind of pressing him for what are you going to do about prediction markets?
01:26It's a new space that courts have largely said this is actually up for the CFTC to decide.
01:32You've had in several states like Nevada and New Jersey, where state gaming regulators sued to stop these prediction markets, calling them illegal gambling.
01:41The courts have said, you know, it's actually up for the CFTC to decide whether these are actually financial instruments and legal markets you can offer or if this is just flouting state law.
01:52And so senators pressed Michael Selig about this.
01:55What would you do on it?
01:56And he largely said, oh, that's actually not up for the CFTC to decide.
01:59That's up for the courts to decide.
02:01One senator, Adam Schiff, even asked him very basic questions.
02:04If, you know, I'm betting on the Bills-Texans Monday night football game last night on one of these apps, is that sports gaming?
02:12Selig declined and said, you know, I'd have to look to previous court decisions, and I don't think I can make that decision.
02:17He then even asked him, if you and I are just betting on the game, is that sports betting or is that a financial instrument?
02:23Again, Selig declined to answer and deferred it to the courts, which all points to the growing kind of sentiment around what people believe is going to end up happening with this stuff,
02:32which is that the Supreme Court will likely decide the fate of it.
02:36Now, again, as you mentioned, it just is going to take more time.
02:39The Supreme Court moves very slowly, and it takes a long time for, you know, cases to get to them.
02:44And you don't even know if they would even take the case at that point.
02:48We could be talking about someone else as president during that time.
02:52Trump administration has been very friendly to prediction markets.
02:54They certainly have a lot of ties to them, been very friendly to crypto as well.
02:58They lifted a Biden administration ban on poly markets.
03:02So by the time this all gets sorted out, you might have a completely different landscape of who the regulator is supposed to be.
03:08And I agree with your takeaway, Craig.
03:09The more all the uncertainty just kind of continues, the more these prediction markets are going to gain steam.
Be the first to comment