At last, the first state to regulate prediction markets emerges

Minnesota passed a first-of-its-kind state law banning prediction market platforms, setting up a direct clash with federal regulators and industry leaders.

The CFTC sued to block enforcement, arguing the law intrudes on federal authority and could disrupt regulated trading markets.

Kalshi and Polymarket say the state law conflicts with federal rules, while Minnesota has carved out some weather-related exceptions in revised language.

The fight could shape how prediction markets are regulated nationwide, with spillover effects for sports betting, financial contracts, and platform operations.