Kalshi Sues Minnesota Over State Law Scheduled to Take Effect in August
Minnesota’s new law, signed by the Governor of Minnesota, makes operating, hosting, promoting, or advertising prediction markets a crime starting Aug. 1, while Kalshi argues the measure is preempted by CFTC authority under the Commodity Exchange Act.
Minnesota has enacted a law taking effect Aug. 1 that makes it a crime to operate, host, promote, or advertise prediction market platforms in the state. Kalshi has sued Minnesota, arguing the law is unconstitutional because the Commodity Futures Trading Commission has exclusive jurisdiction over such event-based contracts under the Commodity Exchange Act, making the state restriction federally preempted. The lawsuit follows a May 19 CFTC motion and adds to the broader dispute over whether states can restrict prediction market activity overseen at the federal level.
- Prediction markets: Platforms where users trade contracts tied to future event outcomes, often structured as event-based financial contracts.
- Kalshi: A regulated event-contract trading platform that operates prediction markets on real-world outcomes.
- Commodity Exchange Act: The U.S. federal law that governs derivatives markets and underpins the CFTC’s authority over certain event-based contracts.