The Commodity Futures Trading Commission would need more resources as its regulatory purview expands with the addition of cryptocurrencies, experts say, and one bill that’s moving in the Senate would increase the agency’s budget.
The CFTC would take on the lion’s share of oversight of the cryptocurrency markets under a Senate Agriculture Committee bill the panel advanced along party lines last month. The House passed its own version of crypto market structure legislation in July 2025 that would give the CFTC a similarly big role.
The Senate Agriculture legislation includes a provision that would authorize $150 million to bolster the CFTC budget. The bill also would allow the agency to collect annual and volume-based fees from the digital commodity brokers, dealers, exchanges and digital asset custodians who would have to register with it.
Congress appropriated $365 million to the CFTC for fiscal 2026. But Senate Agriculture Chairman John Boozman, R-Ark., wants to increase the agency’s budget beyond that level.
“The Chairman is hopeful the $150 million will meet the needs of the agency as it stands up this new regulatory regime and it will have access to the additional spot digital commodity fee-based funding stream, as well as annual appropriations as set by congressional appropriators,” Senate Agriculture spokesperson Sara Lasure wrote in an email. “The $150 million and fee-based structure are advocated by the CFTC and were priorities that Democrats advocated for during negotiations.”
Lasure added: “While the Chairman is supportive of the spot digital commodity fee-based structure as it is appropriately walled-off from applying to derivatives transactions, he has publicly opposed setting fees for derivatives given the important risk management tool they serve to commodity producers and end-users.”
While Congress is poised to tap the CFTC for crypto oversight, the agency also is asserting itself as primary regulator of increasingly popular prediction markets. FiscalNote, the parent company of CQ and Roll Call, has announced a product expansion into political prediction markets.
CFTC Chairman Michael Selig says the agency supports development of prediction markets and wants to establish a regulatory framework for predictions, or events contracts, just as it does for digital assets. Such a move would add to the cost of oversight.
The CFTC filed an amicus brief last week in a federal lawsuit by prediction platforms against Nevada regarding whether the state has regulatory jurisdiction. The CFTC views prediction markets as event-contract markets and says event contracts are commodity derivatives and, therefore, under its purview.
“States cannot invade the CFTC’s exclusive jurisdiction over CFTC-regulated designated contract markets (“DCMs”) by re-characterizing swaps trading on DCMs as illegal gambling,” the brief said.
“Event contracts allow businesses and individuals to hedge event-driven risks, enable investors to manage portfolio exposure, and provide the public with information about the outcome of future events,” Selig said in a Feb. 17 statement. “These products are commodity derivatives and squarely within the CFTC’s regulatory remit.”
Writing rules for the crypto and prediction markets would be a big challenge for the CFTC, said Liz Davis, a former CFTC enforcement lawyer. It’s equivalent to the workload foisted on the agency by a major financial regulatory law, commonly known as Dodd-Frank, enacted following the 2008-09 financial crisis.
“That’s no small feat,” said Davis, a partner at Davis Wright Tremaine. “I liken it to all the rulemaking that had to be done after Dodd-Frank with respect to swaps.”
The CFTC is significantly smaller than the Securities and Exchange Commission. The SEC has a staff of more than 4,000 and a budget of $2.1 billion. The CFTC full-time equivalent staff dropped from 708 at the end of fiscal 2024 to 556 at the end of fiscal 2025, according to a recent report by the agency’s inspector general.
“The agency is broadly understaffed,” said Rob Schwartz, a former CFTC general counsel and now a partner at Morgan Lewis. “An extra $150 million would go a very long way. It will be necessary to hire a lot of employees to complete the task of writing the regulations the CFTC would be required to write.”
The CFTC would have less of a workload if it stayed out of the prediction markets, as nearly two dozen Democrats recently urged it to do. The lawmakers said the CFTC’s stance that it is the primary predictions regulator contravenes state and tribal government gambling laws.
“The real-world consequences are already evident,” the Democrats said in a Feb. 13 letter to Selig. “Prediction market platforms are offering contracts that mirror sportsbook wagers and, in some cases, contracts tied to war and armed conflict. These products evade state and tribal consumer protections, generate no public revenue, and undermine sovereign regulatory regimes.”
The letter was led by Sens. Adam B. Schiff, D-Calif., and Catherine Cortez Masto, D-Nev., and signed by 21 of their Senate Democratic colleagues.
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