Kristin Johnson departs Commodity Futures Trading Commission with predictions market warning
Departing Commodity Futures Trading Commission Commissioner Kristin Johnson has warned that prediction markets, and some crypto platforms, are attracting unprecedented retail money.
In her farewell speech to the Brookings Institution, the former Commissioner said that prediction markets lacked proper regulation, including consumer protections and responsible gaming tools, saying “we have too few guardrails and too little visibility into the prediction market landscape.”
Her remarks came the day that the Commodity Futures Trading Commission issued a no-action relief allowing Polymarket’s US return, after it acquired licensed derivatives exchange and clearing house QCEX for US$112 million.
Johnson criticized this “rent or buy” move, which basically allows companies to obtain approvals and then auction their licenses to others. She also added that prediction markets have the potential to eclipse crypto in retail cash.
She emphasized consumer protection and market stability as two pillars, urging immediate control of leverage, custody, incentive risks, and overall retail exposure, citing previous crypto crises as evidence that weak oversight inevitably leads to financial disasters.
Her warning also lands amid broader regulatory uncertainties, including the Commodity Futures Trading Commission’s foreign board of trade pathway for overseas venues and a joint spot-crypto statement by the US Securities and Exchange Commission and Commodity Futures Trading Commission that left key questions unanswered.
She concluded her farewell speech at Brookings by saying, “Don’t lie. Don’t cheat. Don’t steal.”
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Charlotte Capewell brings her passion for storytelling and expertise in writing, researching, and the gambling industry to every article she writes. Her specialties include the US gambling industry, regulator legislation, igaming, and more.
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