[REVISION HISTORY]

US prediction market legal battles

Updated 5 times since CLSTR started tracking revisions of this situation.

What changed

2026-07-31 13:58 UTC → 2026-07-31 14:28 UTC · added ~~removed~~

In late July 2026 a Minnesota federal judge issued a preliminary injunction halting the state’s law criminalising prediction ~~markets, finding that the Commodity Futures Trading Commission (CFTC) is likely to succeed~~ markets. The order, issued by U.S. District Judge Katherine Menendez on ~~preemption claims because such contracts fall under~~ July 27, applies only to entities registered as designated contract markets—such as Kalshi and Polymarket—and remains in effect pending a final merits decision, leaving the ~~CFTC’s exclusive jurisdiction over swaps.~~ Minnesota ban’s ultimate status uncertain. Two days ~~later~~ later, a Wisconsin district judge denied the CFTC’s request for a comparable injunction, ~~holding that the agency had not shown a~~ finding no likelihood of success or irreparable harm and noting that CFTC registration does not automatically shield platforms from state gambling statutes. Since ~~then~~ then, Kalshi has become the focus of multiple state actions. Arizona Attorney General Kris Mayes filed twenty criminal counts alleging the platform conducted unlicensed gambling on ~~local and national~~ elections and other events. On July 29, New York Attorney General Letitia James sued ~~Kalchi~~ Kalshi for operating without a New York State Gaming Commission licence, seeking a permanent injunction, restitution for users, at least $36 billion in damages and $100,000 penalties per unauthorized sports wager; Governor Kathy Hochul joined the suit, ~~citing~~ emphasizing consumer‑protection and tax‑compliance concerns. In Wisconsin, U.S. District Judge William Griesbach upheld the state’s ability to enforce its gambling laws against Kalshi and other prediction‑market operators, reaffirming the July 27 decision that sports contracts fall within Wisconsin’s commercial gambling statutes. The New Jersey Casino Association has petitioned the CFTC to restrict sports‑related prediction contracts that could conflict with state gambling ~~regulations.~~ regulations, and Kalshi ~~also~~ threatened Netflix with a lawsuit over the documentary “The Prediction Games,” alleging misrepresentation of its business model. These developments extend the earlier legal confrontations and underscore a growing clash between state gambling regulators and the CFTC’s claim of exclusive jurisdiction over prediction‑market contracts.

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