CFTC sues Kentucky over prediction market lawsuits
The agency says Kentucky’s 14.25% tax and state gambling rules would effectively bar prediction markets from operating.
- On Tuesday, the Commodity Futures Trading Commission filed a federal lawsuit against Kentucky, naming Governor Andrew Beshear and Attorney General Russell Coleman, to block state enforcement against prediction markets Kalshi and Polymarket.
- Last week, Coleman sued the firms, alleging they operate unlicensed, illegal sportsbooks in violation of state gambling and sports wagering laws.
- The CFTC argued these event contracts are 'swaps' under federal law and criticized a 14.25% state tax, stating it essentially makes operation in Kentucky impossible.
- Kentucky marks the ninth state the CFTC has targeted to defend exclusive jurisdiction, as 20 states are now actively involved in litigation against these prediction market platforms.
- In May, President Donald Trump provided moral support to the agency, stating it was 'critically important' that the regulator remain the sole authority on prediction markets.
16 Articles
16 Articles
Trump administration sues Kentucky to block challenges to prediction market regulations
Polymarket odds in late June 2026 have Republican Andy Barr winning the Kentucky U.S. Senate race. (Kentucky Lantern photo by McKenna Horsley)A Trump administration organization that oversees regulation of derivatives markets has sued Kentucky to block efforts by the state’s attorney general to prevent two prediction market companies from operating what he says are unlicensed and illegal sports gambling operations. The Commodity Futures Trading…
CFTC Sues Kentucky in Growing Prediction Market State Scramble
The federal agency that regulates derivatives trading sued Kentucky on Tuesday, claiming the state led by a mixed Democratic-Republican governor and attorney general is overstepping on its turf, the newest legal scuffle for control of the booming prediction markets industry.
Some states want to regulate prediction markets. Should the feds let them?
The federal government and a growing number of U.S. states are clashing over the regulation of prediction markets. The Commodity Futures Trading Commission, the federal agency that oversees prediction markets, on Tuesday filed a lawsuit against Kentucky over its efforts to crack down on Kalshi and Polymarket for what state officials allege are violations of gambling laws. Kentucky Attorney General Russell Coleman sued the prediction market platf…
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