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Kalshi follows CFTC in suing Minnesota over law criminalizing prediction markets
The Governor of Minnesota signed into law a measure that, starting Aug. 1, makes it a crime to advertise and operate prediction market platforms across the state.
May 29, 2026, 9:59 a.m. 1 min read
What to know:
- Prediction market platform Kalshi sued Minnesota in federal court to block a new state law that would criminalize operating, hosting or promoting such markets beginning Aug. 1.
- Kalshi argues the law is unconstitutional, saying it intrudes on the CFTC’s exclusive federal authority under the Commodity Exchange Act and unlawfully restricts advertising in violation of the First Amendment.
- The lawsuit comes as prediction markets face mounting global scrutiny, including recent bans in several countries and a U.S. House investigation into whether government employees are trading on nonpublic information.
In its filing, Kalshi claimed the law violates the Supremacy Clause of the constitution, which says the federal Commodity Exchange Act (CEA) grants the CFTC “exclusive jurisdiction” over derivatives and swaps traded on designated contract markets (DCMs).
The platform also challenged a provision that criminalizes the marketing or advertising of prediction markets, saying it violated the First Amendment.
On Wednesday, U.S. President Donald Trump said it was critically important that the CFTC maintain sole authority over prediction markets, echoing CFTC Chair Michael Seligl.
Kalshi has recently won similar preliminary injunctions against enforcement attempts in New Jersey and Arizona.
