The Chicago office of the Commodity Futures Trading Commission (CFTC), historically known as the agency’s “top cop,” has been left with zero enforcement attorneys. This dismantling occurs at a critical moment, just as the organization seeks to aggressively expand its prediction market regulation and its oversight of the digital asset industry. According to reports from Barron’s, the last remaining trial lawyer in that branch resigned last Monday, leaving the office devoid of legal specialists.
Over the past year, the impact of these staff reductions has been devastating for financial supervision metrics across the board. Monetary relief secured by the agency, which reached 17.1 billion dollars in 2024, plummeted in 2025 to a mere 9.2 million dollars. This 99.9% drop in monetary penalties evidences a significant lack of capacity to sanction violations, generating widespread concern among investors and analysts within the global financial sector today.
The management of Caroline Pham, who led the agency as acting chair in 2025, resulted in a total staff cut exceeding 21% of the institution’s workforce. The dismissal of attorneys with decades of experience has left the entity in a vulnerable position, limiting its response capacity toward potential frauds in the cryptocurrency market. Currently, experts point out that there are not enough agents to monitor the complex operations that the Chicago office once handled with precision.
The legal vacuum at the heart of financial supervision
Former agency lawyers, some with over 26 years of service, have described these moves as a targeted action to weaken state supervision. The Chicago office was a key piece in resolving multi-billion dollar cases against giant firms, securing historic settlements with platforms like Binance and the collapsed FTX exchange. Without this elite team, oversight of insider trading on sports betting platforms is now rendered practically non-existent by the current administration.
Despite the obvious lack of human resources, the new nominee to chair the agency, Mike Selig, has refused to request a larger budget. His stance during Senate hearings has generated friction with lawmakers from both parties, who believe the entity is woefully ill-equipped. The lack of commitment to resources casts doubt on whether the CFTC can effectively manage the new workload involved in integrating massive betting markets into its jurisdiction.
Will the CFTC be able to guarantee digital market integrity?
The agency’s transition toward a more permissive approach with digital assets coincides with the departure of officials to the private sector. The lack of cops on the beat encourages, according to the laid-off lawyers, the emergence of new scam schemes within the ecosystem. If prediction market regulation does not have solid legal backing, the risk of manipulation in sports and financial events could scale unprecedentedly in the near future.
Therefore, the future of market integrity depends on a restructuring that returns litigation capacity to regional offices. The centralization of power and staff cuts have created fertile ground for malicious actors, who could take advantage of agency inactivity to operate outside the margins of the law. Detailed explanations regarding the destination of funds and the supervision strategy for 2026 are expected in the upcoming congressional sessions.
