The CFTC sued New York State to block its application of betting laws to prediction markets.

The CFTC has filed a lawsuit in the U.S. District Court for the Southern District of New York, seeking to block New York State's enforcement of its betting laws against federally regulated prediction market platforms. The CFTC argues that federal law grants it sole regulatory authority over such markets and is seeking a permanent injunction against New York State's enforcement actions. CFTC Chairman Michael Selig stated that registered exchanges face multiple state-level lawsuits that undermine the CFTC's sole regulatory authority over prediction markets. Previously, New York State sued Binance and Gemini, alleging their products violated state betting rules and had requested Kalshi to cease certain sports-related contracts. Currently, 37 states and the District of Columbia have filed legal opinions supporting Massachusetts's enforcement of Kalshi's laws, arguing that federal law does not legalize sports betting and has not repealed the states' historical regulatory authority.