White House Eyes Josh Sterling for CFTC Leadership

As reported by Semafor, White House officials are vetting Josh Sterling, a former senior CFTC official currently representing prediction market operator Kalshi as a partner at law firm Milbank, to lead the Commodity Futures Trading Commission (CFTC). The news comes as a consequence of President Trump’s original nominee, Brian Quintenz, stalling.

“If They Lose Their Shirt, That’s On Them”

Sterling worked at the CFTC from 2019 to 2021 and has since become a central figure in legal battles over prediction markets. He has defended Kalshi in cases against Nevada, Maryland, and New Jersey. 

This summer, his blunt views on player responsibility at the National Council of Legislators from Gaming States raised many eyebrows.

“People are adults, and they’re allowed to spend their money however they want. And if they lose their shirt, that’s on them,” Sterling said. He also argued that questions about whether event contracts qualify as swaps should be left to the CFTC, not the courts.

His work has extended beyond Kalshi. Earlier this month, he wrote to the CFTC’s inspector general on behalf of fantasy app Sleeper, claiming the agency illegally blocked its bid to become a futures commission merchant despite the National Futures Association being prepared to approve it.

More Possible Names on the Table

Sterling’s candidacy comes after the administration asked the Senate Agriculture Committee to pause consideration of Kalshi director and shareholder Quintenz. While Quintenz pledged to divest if confirmed, conflict-of-interest concerns continued to linger. 

His nomination has also faced lobbying from crypto exchange founders Tyler and Cameron Winklevoss, whom Quintenz publicly accused of opposing him for personal reasons. Despite backing from allies such as venture capitalist Marc Andreessen, his prospects appear dim.

However, Sterling is not the only name in circulation. Bloomberg recently reported that U.S. Securities and Exchange Commission (SEC) official Michael Selig and Treasury counselor Tyler Williams are under review, while other outlets have mentioned SEC chair Paul Atkins. 

A possible candidacy from the latter could raise its own legal issues under the Securities Exchange Act, which does not allow commissioners to hold outside employment.

Big Challenges for Prediction Markets

Meanwhile, prediction markets are facing separate challenges in the courts. In Nevada, Crypto.com has sued to block regulators from shutting down its sports event contracts, arguing, like Kalshi, that the CFTC has sole authority. 

A coalition of 10 tribal organizations and 24 federally recognized tribes filed an amicus brief last week opposing Crypto.com’s position. They argue the contracts amount to “Class III Gaming” under the Indian Gaming Regulatory Act, a category reserved for tribal operators in certain jurisdictions.

The brief warns that allowing non-tribal platforms to offer these products would undermine tribal sovereignty and revenue, urging the judge to side with Nevada regulators.