CFTC sues to block Utah from enforcing gambling laws against prediction markets
The Commodity Futures Trading Commission (CFTC) announced on Tuesday that it has filed a lawsuit against the state of Utah to stop the state’s efforts to shut down CFTC-registered contract markets. The lawsuit follows a lengthy battle the state has been fighting against prediction markets. In August, a federal judge in Utah ruled that the...
The US Commodity Futures Trading Commission (CFTC) has filed a lawsuit against the state of Utah in an attempt to block its actions against prediction markets. Utah's attorney general plans to sue Kalshi, a prediction market platform, and its affiliates for up to $60 million in profits allegedly obtained illegally. The CFTC claims that Utah is attempting to circumvent federal law by restricting the functioning of CFTC-registered exchanges.
The CFTC argues that the event contracts targeted by Utah are "swaps" under the federal Commodity Exchange Act and that the exchanges offering these contracts are CFTC-regulated Designated Contract Markets (DCMs). Kalshi's spokesperson, Jacki McGavick, asserts that as a national derivatives market overseen by the CFTC, Kalshi is subject to federal law and no single state should have the authority to veto it.
This legal dispute between federal and state authorities over prediction markets may ultimately be decided by the Supreme Court, as similar cases are pending in other states.
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