Legal Battles Intensify in Prediction Markets: CFTC vs. Minnesota and More

The prediction market sector is currently under intense legal scrutiny, with multiple regulatory actions being taken against it worldwide. The Commodity Futures Trading Commission (CFTC) has launched a lawsuit against Minnesota, arguing that the state had no right to try to outlaw prediction markets. This follows the state’s signing a law into effect, which is set to criminalize prediction market platforms on August 1, 2026, should no court-ordered injunction arrive in the interim.

Rhode Island’s Attorney General, Peter Neronha, has filed a 32-page complaint against prediction markets in the Providence County Superior Court, insisting that platforms such as Kalshi and Polymarket were flouting state laws on gambling. The President of the United States, Donald Trump, has criticized opponents of the prediction market, using strong language to describe the sector’s critics.

The European Court of Justice has weighed in on an important issue concerning the gambling market in the European Union and what laws ought to apply when it comes to regulating the sector. Tennessee has moved forward this week to enact a new law that effectively bans sweepstakes casinos. Indonesia has moved against Polymarket, blocking the platform outright, possibly after the company featured a market on whether the country’s President would see his term ended prematurely. Spain, has only temporarily suspended access to the platforms over the next three to four months while the investigation is ongoing.