The federal government and the states are now in a real showdown.
The U.S. CFTC has issued a new legal interpretation requiring designated contract markets (DCMs), including Kalshi and Polymarket, not to restrict user access based on state. Platforms that have already imposed geographic restrictions must restore service within 30 days or explain to regulators why they cannot. This conflicts with restrictive rulings against prediction-market platforms issued by some courts. Kalshi currently restricts trading in Nevada, Washington, and Michigan, and a federal court in California has also barred it from offering sports-event contracts on the lands of the Native American tribe involved in the case.
CFTC Chairman Michael Selig said geographic access restrictions do not meet the fair-access requirements of the Commodity Exchange Act and could undermine market liquidity. Several states still maintain that sports contracts on prediction markets fall under state gambling laws. This is an escalation in the dispute over regulatory authority—not a definitive win for the platforms.
Two scenarios to watch: First, whether states continue enforcing court injunctions, creating a stalemate in which “the feds want me to open up, while the states want me to block access.” Second, whether platforms actually open access in restricted states within 30 days.
Are you more focused on how state courts enforce their rulings, or on whether platforms actually open access within 30 days?
Source: Wu Shuo
Image 1: CFTC orders prediction markets to remove state-level restrictions, setting up a head-on clash with courts in several jurisdictions · Screenshot from the source page
Image source: https://www.wublock123.com/news/cftc-orders-prediction-markets-remove-state-restrictions-conflict-court-rulings-71505
The U.S. CFTC has issued a new legal interpretation requiring designated contract markets (DCMs), including Kalshi and Polymarket, not to restrict user access based on state. Platforms that have already imposed geographic restrictions must restore service within 30 days or explain to regulators why they cannot. This conflicts with restrictive rulings against prediction-market platforms issued by some courts. Kalshi currently restricts trading in Nevada, Washington, and Michigan, and a federal court in California has also barred it from offering sports-event contracts on the lands of the Native American tribe involved in the case.
CFTC Chairman Michael Selig said geographic access restrictions do not meet the fair-access requirements of the Commodity Exchange Act and could undermine market liquidity. Several states still maintain that sports contracts on prediction markets fall under state gambling laws. This is an escalation in the dispute over regulatory authority—not a definitive win for the platforms.
Two scenarios to watch: First, whether states continue enforcing court injunctions, creating a stalemate in which “the feds want me to open up, while the states want me to block access.” Second, whether platforms actually open access in restricted states within 30 days.
Are you more focused on how state courts enforce their rulings, or on whether platforms actually open access within 30 days?
Source: Wu Shuo
Image 1: CFTC orders prediction markets to remove state-level restrictions, setting up a head-on clash with courts in several jurisdictions · Screenshot from the source page
Image source: https://www.wublock123.com/news/cftc-orders-prediction-markets-remove-state-restrictions-conflict-court-rulings-71505
