The Commodity Futures Trading Commission (CFTC) has begun firings of more than two dozen staff members, according to a report.
Reuters, citing an agency source, reported Wednesday that the commodities watchdog — which regulates prediction markets like Kalshi and the yet-to-launch Railbird — had started cutting jobs in its “enforcement, market oversight, administration, and data divisions” as part of a “reorganization.”
The CFTC had previously made voluntary resignation offers to staff earlier this year.
According to the CFTC’s budget, the regulator had 636 full-time equivalent staff on Sept. 30, 2024, the end of the last fiscal year. That would mean this round of cuts would represent around 4% of its workforce.
The cuts come as the CFTC’s leadership team is particularly short-handed, with the number of commissioners in place set to fall to just one — Acting Chair Caroline Pham — later this year. Summer Mersinger and Christy Goldsmith Romero both left their roles as commissioners at the end of May, while Kristin Johnson will leave “later this year.” Chairman Rostin Behnam left the regulator in February, with Pham taking on the role of chair on an interim basis.
Pham herself is set to leave once the current nominee to lead the regulator — Brian Quintenz — is confirmed.
Upside for Kalshi?
A leaner CFTC may be advantageous to Kalshi, which relies on self-certification to offer its sports event contracts — the prediction market’s largest source of volume and revenue.
The CFTC has the power to block contracts determined to be against the public interest, though it has never used this power in its history. Less oversight staff may suggest the regulator is less likely to consider blocking contracts, and could even suggest that there is an opportunity for Kalshi to expand its offering, knowing the CFTC aims to take a light-touch approach.
The cuts come after a Supreme Court ruling last week appeared to give the green light to mass government layoffs. In McMahon v New York, the nation’s highest court voted 6-3 to allow the Trump administration to cut 1,378 jobs at the Department of Education.
The court did not provide a majority opinion, so the exact scope of the ruling may still be up for debate.
The CFTC did not immediately respond when approached by InGame for comment.
