CFTC Sues Rhode Island in 7th State Fight Over Prediction Market Rules
Updated
Updated · CNBC · May 28
CFTC Sues Rhode Island in 7th State Fight Over Prediction Market Rules
7 articles · Updated · CNBC · May 28
Rhode Island became the seventh state sued by the CFTC after the agency moved to intervene in the state's case against Kalshi and Polymarket and filed its own complaint.
The clash began after Attorney General Peter Neronha accused the two platforms last week of violating state sports-betting laws through sports-related event contracts.
CFTC Chairman Michael Selig said those contracts fall under the agency's exclusive federal authority over swaps and derivatives, calling the state actions an attack on Americans' access to event contracts.
Neronha said federal intervention does not change Rhode Island's case, while 18 states are now in litigation over prediction markets and Minnesota has moved to ban them outright.
President Donald Trump backed preserving the CFTC's exclusive jurisdiction this week, underscoring how the state-federal fight has widened beyond a single lawsuit.
As federal and state regulators clash, what is the ultimate fate of America’s booming prediction markets?
Are event contracts innovative financial tools or just a new form of state-regulated gambling?