TLDR
- Elizabeth Warren accused Trump of weakening the CFTC in favor of crypto-related allies and family interests.
- The CFTC is facing scrutiny over its dealings with prediction market companies linked to cryptocurrency platforms.
- Prediction markets remain contested, with states calling for some products to be treated as gambling.
- Warren called for the enactment of cryptocurrency legislation to reduce conflicts of interest and protect consumers from fraud.
- Warren also proposed taxing AI companies and large data centers to offset overhead energy costs.
Senator Elizabeth Warren accused President Donald Trump of weakening the federal cryptocurrency watchdog to benefit his family and allies, and renewed her call for legislation aimed at preventing conflicts of interest and protecting consumers from fraud.
Warren made the comments about X after reports described internal tensions at the Commodity Futures Trading Commission over prediction markets and cryptocurrency-related companies with ties to the Trump family’s business interests. She said the president should not benefit financially from agencies he controls, and said her bill would target what she described as conflicts involving cryptocurrency projects.
The comments come as prediction markets face a growing legal and political battle over whether they should be treated as federally regulated financial products or as a state-regulated gambling activity.
Elizabeth Warren targets CFTC oversight of cryptocurrencies
Elizabeth Warren said Trump was “destroying cryptocurrency watchdogs” while companies linked to his family and associates seek preferential treatment from federal regulators. Her comments followed reports that senior CFTC officials had raised concerns about prediction market companies, including Crypto.com, Polymarket, and Gemini-related businesses.
Donald Trump is canceling the mission of policing cryptocurrencies so that the Trump family and their friends can enrich themselves.
We need cryptocurrency legislation that stops this corruption and protects Americans from being defrauded. pic.twitter.com/bZfUw3WfWK
-Elizabeth Warren (@SenWarren) May 27, 2026
According to reports, some career officials questioned whether retail users were treated fairly, whether fraud protection was strong enough, and whether some companies had completed required reviews. Several senior officials were later placed on leave or sidelined while internal reviews were opened.
The Commodity Futures Trading Commission (CFTC) has become central to the cryptocurrency market debate and forecasts in Washington. Under Trump, the agency argued that prediction markets should be subject to federal commodities law when operated through regulated platforms.
State officials from both parties have challenged this view. Many states argue that event contracts, especially those related to sports, elections or public events, are akin to gambling and should be handled under state law.
Prediction markets face state resistance
Prediction markets allow users to trade contracts based on future outcomes. These can include political races, economic reports, sports scores, political decisions, and other events.
Platforms like Kalshi and Polymarket have gained wider attention as trading volume has increased. Proponents say markets create useful forecasting tools. Critics say the products could resemble betting platforms and could raise concerns about inside information, manipulation and consumer protection.
Minnesota Governor Tim Walz recently signed a law restricting prediction market activity in the state. New York Attorney General Letitia James has also taken action against cryptocurrency companies accused of offering gambling-style products through prediction market platforms.
The Trump administration has responded Defending the CFTC Authority in court. Trump said it was “extremely important” for the CFTC to maintain its authority over prediction markets, linking the issue to US leadership in cryptocurrencies and fintech.
Elizabeth Warren’s position differs sharply from that of the administration. She has argued that cryptocurrency legislation should prevent elected officials and their families from profiting from digital asset projects while in office.
Elizabeth Warren is also calling for a tax on artificial intelligence
Warren has separately proposed taxing AI companies, saying AI gains should benefit the public and not just big tech companies and investors.
In an op-ed for Time magazine, Warren said policymakers should consider taxing large AI data centers based on energy consumption. She said that the use of electricity in data centers could raise costs for households, and that companies that benefit from the growth of artificial intelligence should help cover those overhead costs.
It also renewed its support for broader wealth tax ideas and appointed AI-related business leaders, including the CEO of OpenAI. Sam Altman And Amazon founder Jeff Bezos weighs in on her argument.
Warren said AI policy should include consumer safeguards, rules for national security risks, and measures to address electricity demand. Her proposal comes as Congress remains divided over regulation of artificial intelligence, with lawmakers debating how to balance innovation with worker protections, energy use and public safety.
