Gary Gensler admits he was checking Polymarket on Wednesday night, watching the odds as the New York Knicks erased a 29-point deficit to beat the San Antonio Spurs by one.

San Antonio’s win odds were trading near $0.93 when he looked, Gensler told CNBC on Thursday. He placed no bet and holds no economic interest in the platforms.

The day after the game, he filed an amicus brief siding with Ohio in Kalshi’s Sixth Circuit appeal, arguing the agency he once ran has no business regulating those wagers.

Why Gensler Says ‘Let The States Do It’

Gensler chaired the Commodity Futures Trading Commission from 2009 to 2014 and helped write the Dodd-Frank Act. That 2010 law covered credit-default and interest-rate swaps after the financial crisis, he said, not sports betting.

The CFTC was built in the 1970s to watch corn, wheat and agricultural derivatives, he noted, mocking the idea it should police millions of micro-bets on whether a player hits a three-pointer.

Better to let the states handle the wagers, and the addiction and youth-gambling concerns that come with them, he said.

The CFTC has since shrunk to roughly 400 people, with another round of cuts this week.

The ‘Trading Places’ Loophole

Policing insider trading on these platforms is much harder than in the stock market, Gensler said, after the hosts raised a recent case of a Google employee who reportedly placed bets while aware of internal company information.

While writing Dodd-Frank, he realized the plot of “Trading Places,” trading on a leaked government crop report, was not actually illegal. He had Congress fix it, creating what he calls the “Eddie Murphy Provision.”

That integrity gap is part of why Washington fears non-sports contracts. Gensler recalled DARPA’s post-9/11 plan to run a market on terrorism, war and assassinations, which the Bush administration killed within 24 hours.

What It Means For DraftKings

Gensler said sports betting now makes up an estimated 70% to 80% of volume on Kalshi and Polymarket, pitting the platforms against DraftKings Inc. (NASDAQ:DKNG) and FanDuel parent Flutter Entertainment (NYSE:FLUT).

The sportsbooks have a regulatory argument. Under the CFTC’s proposed framework anyone 18 or older could bet nationwide, while states cap sports betting at 21 and 11 ban it outright.

If courts back the states, prediction platforms may face state-by-state registration and tighter age limits, likely easing the squeeze on the books. The fight is likely headed to the Supreme Court, according to Gensler.

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