The US gaming industry is facing a direct federal challenge after the Commodity Futures Trading Commission (CFTC) filed an amicus brief backing Crypto.com in its dispute with the Nevada Gaming Control Board.

The intervention signals a clear shift in approach from the federal regulator, which is now asserting authority over prediction markets and event contracts, areas traditionally overseen by state gaming regulators.

The issue was analysed on the iGaming Daily podcast, hosted by Fernando Noodt, with SBC Americas Senior Journalist, Tom Nightingale and Business Journalist, Justin Byers.

The three highlighted the change in tone from CFTC Chair, Michael Celig. During his Senate nomination hearings, Celig indicated that jurisdictional questions should be settled by the courts. Months later, the CFTC formally supported Crypto.com’s position.

“The fact that the federal regulator is willing to go to battle sort of against states… it’s a pretty seminal moment really,” said Nightingale, describing the move as a direct challenge to long-standing state authority.

If the courts side with the CFTC, the ruling could reduce the power of state regulators over certain sports-related contracts. That would create new strategic options for operators such as FanDuel and DraftKings.

Federally approved event contracts could allow access to markets where traditional sports betting remains restricted, including California, Texas, Georgia and Florida.

Prediction markets do not yet match sportsbooks in product depth, particularly in-play betting and same-game parlays. However, they can offer contracts on political and entertainment outcomes, giving them a broader product scope than state-regulated sports betting.

Industry stakeholders expect a lengthy legal process, with the potential for the case to reach the US Supreme Court.

The sector is also monitoring separate litigation involving prediction market operator Kalshi and Nevada regulators, as attention turns to how far the CFTC is prepared to extend its federal oversight.