The U.S. Commodity Futures Trading Commission (CFTC) filed lawsuits against Arizona, Connecticut, and Illinois. The agency seeks to assert exclusive federal jurisdiction over prediction markets.
The legal action aims to block states from applying local gambling laws to platforms like Kalshi. This follows state-issued cease-and-desist orders and criminal charges filed by Arizona against the platform.
The CFTC classifies these event-based contracts as federally regulated financial instruments known as swaps. This litigation will determine if the industry faces a patchwork of state laws or a single federal standard.