44 States Challenge CFTC Authority Over Sports Prediction Markets
A coalition of 44 state attorneys general sent a letter to the Commodity Futures Trading Commission (CFTC) arguing that the agency lacks the statutory authority to regulate sports-related event contracts on prediction market platforms. The letter was submitted as the public comment period for the CFTC's first proposed rule on prediction market regulation ended. The states contend that sports-related contracts resemble sports betting, which falls under state jurisdiction, and that the CFTC's proposed rule is an overreach. The CFTC has sued nine states to defend its exclusive regulatory authority over these markets. The CME Group also submitted a letter criticizing the CFTC's definition of 'gaming,' arguing it could preempt state sports regulations. The dispute has intensified as prediction market volumes surged, driven by events like the 2026 FIFA World Cup.
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