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CFTC Levies Trio of Lawsuits, Challenging State Authority to Regulate Prediction Markets
The derivatives regulator just sued Arizona, Connecticut, and Illinois, asserting that states have no authority to regulate federally registered markets.
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Today, the Commodity Futures Trading Commission (CFTC) filed a trio of lawsuits, asserting that state regulators have no authority over federally registered prediction markets.
What's the Scoop?
- Levying Lawsuits: Assisted by the Department of Justice, the CFTC today filed lawsuits against the states of Arizona, Connecticut, and Illinois, whose regulators are attempting to shutter aspects of popular prediction markets, claiming sports-linked products that should be regulated under state law.
- Clear Authority: In a press release discussing the lawsuits, CFTC Chair Mike Selig made clear his agency's views that federally regulated derivatives markets enjoy supremacy over state law. “The CFTC will continue to safeguard its exclusive regulatory authority over these markets and defend market participants against overzealous state regulators,” he said.
The @CFTC has clear and longstanding exclusive jurisdiction to regulate prediction markets. But recently, state regulators have tried to impose inconsistent and contrary obligations on CFTC-registered prediction markets. In response, the CFTC and @TheJusticeDept today filed three…
— Mike Selig (@ChairmanSelig) April 2, 2026