CME’s Duffy Clashes With Kalshi and the CFTC Chair Over Prediction Market Manipulation

A Commodity Futures Trading Commission advisory meeting turned into a public squabble Thursday, with CME Group Chairman and CEO Terrence Duffy clashing first with CFTC Chairman Michael Selig and then with Kalshi co-founder and COO Luana Lopes Lara over whether prediction markets are being policed seriously enough.

Duffy told the Innovation Advisory Committee he was concerned about the volume of self-certified event contracts and the manipulation risk in some of them, singling out contracts tied to what President Donald Trump would say during his State of the Union address and to when Venezuelan President Nicolás Maduro would be ousted. “There are definitely people that are manipulating these contracts,” he said. Selig interrupted to say those products had been listed offshore rather than in the U.S., calling the claim “fake news.”

Beyond manipulation, Duffy questioned why Kalshi could offer a compute prediction market while CME’s own compute contracts remained under review.

Lopes Lara pushed back after Kalshi was named, asking Duffy whether CME had ever faced a manipulation problem in its history. Duffy answered that his regulatory department has more people than Kalshi has in its entire company. “Maybe you should learn a bit about efficiency then,” Lara responded. Duffy told her to learn about credible markets before the moderator stepped in. DraftKings CEO Jason Robins later asked participants to stop attacking each other’s business models.

Selig said Thursday the agency will propose further amendments to how designated contract markets list event contracts, along with new retail consumer protection standards. CME, for its part, sued the CFTC in June over its approval of Kalshi’s perpetual futures.

Related Listen: DEX in the City: The CFTC’s Kalshi Rescue and the Limits of Emergency Power

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