For the second time in as many weeks, a Senate committee vote on Brian Quintenz’s appointment as the next head of the Commodity Futures Trading Commission was delayed.
Quintenz’s appointment as CFTC Chairman looms a pivotal to the sports betting industry. Quintenz has said that on his watch, the agency will allow prediction markets to continue to offer sports event contracts, which are strikingly similar to sports wagers.
An affirmative committee vote is needed to move Quintenz’s nomination to the full Senate.
Scheduled for last night, Monday, July 28, a vote by the Senate Committee on Agriculture, Nutrition, and Forestry was pushed back, per a request from the Trump administration, multiple news outlets are reporting.
“That’s the only communication we’ve had [with the administration],” Committee Chair John Boozman (R-AR) told Bloomberg’s Yash Roy. “My question was how would you like us to respond and they said if there were any further questions to contact the White House.”
Quintenz remains Trump’s nomination to head the CFTC, according to reports.
Second time not a charm
Last Monday’s vote on Quintenz was postponed when Republican Senator Cindy Hyde-Smith’s flight was delayed. The GOP believed they needed all their committee members present to send Quintenz’s nomination to the full Senate, as Democrats indicated they’ll vote against him.
Sen. Boozman said then that the vote would happen before Congress’ August recess. With the break coming by next week, the CFTC is “in a tenuous position regarding what’s already a delicate leadership situation,” CoinDesk’s Jesse Hamilton writes.
Democrat Amy Klobuchar, the Agriculture Committee’s ranking member, told Bloomberg’s Roy that she was “surprised” the vote was pulled for a second time.
Republican Caroline Pham, appointed by Trump, is acting chair of the CFTC, a position she said she’ll relinquish once a permanent head is confirmed.
CFTC dealing with multitude of issues
The CFTC has lots on its plate. Beyond prediction markets, there’s cryptocurrency. Congress is considering putting regulation of crypto, including Bitcoin, in the CFTC’s hands.
Sports, of course, is where our industry’s eyes are most affixed.
Prediction markets are facing immense legal pressure from states, Native American tribes and gambling organizations, who contend companies like Kalshi are illegally operating as sportsbooks. Kalshi has so far been successful in the courtroom against the states, and Quintenz stated as CFTC chair, he would support prediction markets.
Quintenz sits on the Kalshi board, but said he’ll step down from that role should he be confirmed. Also, Donald Trump Jr. is a “strategic advisor” to Kalshi. These relationships have prompted questions around potential conflicts of interest between the administration and prediction markets.
Sportsbooks’ position on prediction markets
While states and tribes are staunchly opposed, sportsbooks are sort of on the fence regarding prediction markets. On one hand, operators see them as a threat; on the other, the emerging sector is an opportunity.
Kalshi offers sports markets in all 50 states, including coveted California and Texas, while regulated sportsbooks are restricted by state laws and licensing requirements.
FanDuel, whose parent company Flutter Entertainment owns Betfair — a sports betting exchange that functions similarly to prediction markets — has been in talks to partner with Kalshi. DraftKings has reportedly been negotiating to acquire Railbird Exchange, which plans to launch a prediction markets platform.
On his company’s earnings call today, BetMGM CEO Adam Greenblatt spoke of the “risks and opportunities” associated with prediction markets.
“In relation to prediction markets, we are monitoring this very, very closely,” Greenblatt said. “… What I will say is that we won’t be caught flat-footed.”
Pressed further, Greenblatt said BetMGM has the ability to enter the prediction markets space, but “does not have the desire to be a first-mover.”
He intimated that opposition from state regulators and attorneys general, as well BetMGM’s tribal partners, is a deterrent, and that BetMGM does not have a “right” to enter “what is a very different market, from a regulatory perspective.”
Greenblatt added, “We are not underestimating the possibility that this becomes a meaningful factor in our sector. But we are not going to be a first mover in this domain.”
