A battle line has been drawn between states that want to maintain control over wagering and betting and prediction markets that offer event-driven markets for a wide range of binary outcomes.
Earlier today, CFTC Chairman Mike Selig threw down the gauntlet, declaring that the Commission is ready to litigate to maintain state preemption and protect these emerging markets.
Multiple states are now engaged in lawsuits filed against platforms like Kalshi and Polymarket. And at least one, Utah, took to social media to challenge the CFTC’s legal posture.
Governor Spencer Cox of Utah, a Republican, posted:
“Mike, I appreciate you attempting this with a straight face, but I don’t remember the CFTC having authority over the ‘derivative market’ of LeBron James rebounds. These prediction markets you are breathlessly defending are gambling—pure and simple. They are destroying the lives of families and countless Americans, especially young men. They have no place in Utah. Let me be clear, I will use every resource within my disposal as governor of the sovereign state of Utah, and under the Constitution of the United States to beat you in court.”
Multiple states are challenging prediction market platforms that prefer federal regulation. These include Nevada, New York, Massachusetts, Hawaii, Maryland, and more. The battle is not partisan as both Republicans and Democrat states are geaering up to ensure these platforms are regulated by state entities instead of federal regulators.
