Gary Gensler Backs Ohio Against the CFTC in Landmark Sports Betting Jurisdiction Case

Gary Gensler, who previously chaired both the Commodity Futures Trading Commission and the Securities and Exchange Commission, entered the national prediction market legal debate on June 12 by filing an amicus brief in the Sixth Circuit Court of Appeals in support of Ohio’s position against Kalshi. Gensler’s brief argues that the current CFTC is overreaching by claiming exclusive federal authority over sports-based event contracts — a position with major implications for how prediction markets are regulated across the country.

Gensler told CNBC after the filing that the central question is whether Congress intended in 2010 to remove state regulation of sports betting entirely and hand it to a small federal agency. “The answer is categorically ‘No,'” he said. His brief draws directly on his own experience drafting the Dodd-Frank Act after the 2008 financial crisis, arguing the law was designed to address systemic risks in complex financial markets — not to preempt state authority over gambling.

What the Dodd-Frank Dispute Is Really About

The current CFTC under Chairman Michael Selig has been arguing in federal courts across eight states that sports event contracts qualify as “swaps” under Dodd-Frank — a definition that would place them under the CFTC’s exclusive jurisdiction and shield them from state gambling laws. Kalshi, the prediction market platform at the center of most of these cases, operates as a federally registered Designated Contract Market and argues it is legally authorized to offer sports event contracts nationwide without state gaming licenses.

Gensler directly challenges that characterization. A swap, as defined and intended under Dodd-Frank, is a financial instrument used to hedge economic risk — think interest rate swaps between financial institutions or commodity price contracts between businesses. He argues that sports event contracts do not fit that definition. “Sports bets are very rarely, if ever, about hedging,” he wrote in the brief.

He also contended that a change of this magnitude — effectively nationalizing the regulation of sports wagering and removing state authority — would not have been quietly embedded in financial reform legislation without explicit discussion. Congress had extensive debates about what counted as a swap during Dodd-Frank’s drafting, and sports betting was never raised as an intended application of the new framework.

The Sixth Circuit Ruling Could Set National Precedent

The Sixth Circuit case involving Ohio and Kalshi is one of several prediction market disputes now working their way through federal courts. The circuit courts hearing these cases will eventually produce rulings that either align with the CFTC’s position or support state authority, and any disagreement between circuits would strengthen the case for Supreme Court review.

For sports bettors, the outcome of these cases determines whether prediction markets become a permanent and legally settled feature of the national landscape or remain in contested territory for years to come. If the CFTC wins broadly, Kalshi, Polymarket, and newer platforms like ProphetX would operate under a single federal license, potentially accessible in states that currently do not have regulated sports betting. If Gensler’s view prevails, each state would set its own terms for prediction market access.

Ohio has been one of the most active states in challenging prediction market platforms. The state has a robust regulated sports betting market with major operators competing actively since 2023. For more information on the licensed options currently available, see our Ohio sports betting guide. Traditional sportsbooks remain the safest bet in states where the legal lines are still being drawn — you can compare the best offers through our sportsbook promotions page. And for a full breakdown of sports betting legal status across the country, see our state-by-state sports betting guide.