Michigan’s gaming regulator has broken with prediction markets, with executive director Henry Williams calling a CFTC proposal “meritless. Period.” and saying federal rule changes cannot replace state licensing and consumer-protection regimes. He also said Michigan’s withdrawal from the National Council on Problem Gambling was meant to draw a line between licensed wagering and what the state sees as unlicensed gambling.
As reported in July, Michigan had already withdrawn from NCPG after Kalshi joined the council. Williams said the board could not remain affiliated with an organisation partnered with a company the state considers to be operating illegal, unlicensed gambling, and that the move created confusion about who is meeting consumer-protection standards.
Williams said the CFTC’s proposal could not resolve the federal-state boundary on its own. He argued only a court decision drawing a clear preemption line or legislation from Congress can settle the issue, and warned that overlapping claims of authority leave the industry in an unstable position.
The CFTC published its notice of proposed rulemaking on 10 June, seeking comment on amendments to Regulation 40.11 and the addition of Appendix F to part 40. It said it had seen growth in event contracts, including those tied to sporting events, and that the proposal would create a structured framework to assess whether contracts involve activity listed in Section 5c©(5)(C) of the Commodity Exchange Act, including gaming, and whether they are contrary to the public interest.
Chairman Michael S. Selig said the framework is meant to identify contracts Congress directed the agency to scrutinise while letting legitimate markets move forward. The proposal sets out a 90-day review process and defines key terms such as “involve” and “gaming.”
Williams also said calling prediction-market products investment or trading instruments rather than wagers undermines a basic responsible-gaming principle that gambling is for entertainment, not a financial strategy.
Michigan is one of seven states that regulate both iGaming and online sports betting. The state has 15 licensed iGaming and internet sportsbook operators, and Williams said 2025 adjusted gross revenue from that market reached $3.3 billion, up 39% year on year and enough to place Michigan among the top three online gambling markets in the U.S. by total online revenue.
Williams also said licensed operators face a competitive disadvantage from unregulated or ambiguously regulated products, particularly prediction markets, because they do not follow the same licensing, tax and consumer-protection rules. He said Michigan does not track gambling-harm and addiction prevalence rates, as is true across the U.S., and argued that more consistent state and national data collection is needed so responsible-gaming policy is not based on assumptions.
NCPG says it is the sole national advocate for people affected by problem gambling and their loved ones. In a 10 March 2025 letter to the CFTC, it said futures on sporting events blur the line between investing and gambling and should be subject to similar protections, including access to help and self-exclusion.
