What to know:
- CFTC officials faced suspension after raising concerns over prediction market firms.
- An NYT report says Polymarket, Crypto.com, and Gemini affiliates drew new staff scrutiny.
- House lawmakers warned the CFTC lacks enough commissioners for its growing duties.
Senior officials at the CFTC were suspended, investigated, and pushed out after raising concerns about prediction market firms, according to a New York Times investigation. The report said career staff had questioned companies with alleged ties to the Trump family.
The concerns involved Polymarket, Crypto.com, and a Gemini affiliate. Staff members feared that Crypto.com did not offer a fair deal to smaller bettors.
Also Read: CFTC Minnesota Lawsuit Could Redefine Rules for Prediction Markets in the US
CFTC Officials Suspended After Internal Crypto Concerns
They raised doubts about the sufficiency of fraud prevention measures in Polymarket. The report stated the affiliate of Gemini failed to undergo the necessary regulatory review.
The investigation found that then-CFTC Chair Caroline Pham and high-level counsel Brigitte Weyls stepped in while the firms applied for CFTC approvals. Sources told the outlet that those companies later received the outcomes they wanted.
Two officials who are raising questions will have been moved into administrative positions by late 2025. An internal investigation was launched against them.
The other three officials who had worked on crypto enforcement were subjected to the same. None were told what rules they had violated, according to the report.
The suspensions carry a clear message to the agency’s workers. Current and former workers said they felt employees thought they should not cause any problems to those industries. During the same time period, CFTC’s crypto enforcement activities were scaled back.
CFTC Enforcement Shift Faces Fresh Scrutiny
The agency let go of at least five crypto cases, the report said. During Biden’s tenure, it has taken over 80 enforcement actions relating to cryptocurrencies. It filed just two cases under Trump. They targeted both individual operators and not large corporations.
Pham stepped down from his role at the CFTC and became a member of MoonPay, a crypto company that has previously been in partnership with Polymarket. Weyls became general counsel at Gemini Titan. The report said she had helped approve the same company’s application at the agency.
Current Chair Michael Selig is the agency’s sole commissioner. He was once a corporate lawyer for crypto companies, the report said. The White House rejected conflict concerns. Spokesman Davis Ingle said President Trump acts in the public interest.
The report also cited business ties between the companies. Trump Media has partnered with Crypto.com. Polymarket has been funded by 1789 Capital, a venture firm backed by Donald Trump Jr., who is a co-founder of the American Bitcoin Corp.
The CFTC has been engaged in litigation related to prediction markets and state regulators. Last week, the House Agriculture Committee urged Trump to nominate four commissioners. Lawmakers cautioned that one member is not enough to run the agency.
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