50 states + territories — gaming, consumer protection, securities
Cease-and-desist active in 13+ statesActive preemption litigation
State gaming boards, attorneys general, securities regulators, and consumer-protection agencies asserting jurisdiction over sports and election event contracts under state gambling, consumer-protection, and anti-wagering statutes.
Other StateOtherMedium2d ago
Flutter Entertainment restructured its FanDuel Predicts joint venture so that Crypto.com now supplies all sports and novelty (entertainment, political, parlay-style) event contracts, replacing CME Group in that role; CME, which retains its 51% JV ownership stake, continues supplying financial event contracts only. The shift follows CME CEO Terry Duffy's July 22 earnings-call remarks distancing the exchange from sportsbook-style products, saying "a lot of these prediction markets on sports are gambling."
Genius Sports and Kalshi announced an official data, marketing, media, and integrity-services agreement covering Genius's real-time soccer data (EPL, Serie A, Liga MX, Argentine Primera División, Ligue 1, and more) to settle Kalshi's sports event contracts against verified official data. Kalshi will also join Genius Sports' information-sharing network, which includes trading-activity monitoring and restrictions on certain market types — mirroring a deal Genius Sports already has in place with Polymarket.
Bloomberg reported on August 4, 2026 that Polymarket is in early talks with prospective investors to raise roughly $1 billion at a valuation exceeding $20 billion, more than double the $9 billion valuation it carried in October 2025. The round would follow the $15 billion valuation Polymarket closed at in April 2026, which brought in D.E. Shaw and G Squared alongside a $600 million strategic investment from Intercontinental Exchange. The talks remain early-stage and unclosed; a Polymarket spokesperson declined to comment. The reported target still trails rival Kalshi, which said in May 2026 it had raised new capital at a $22 billion valuation and has separately been in discussions for a round at roughly $40 billion.
Sens. Jeff Merkley, Catherine Cortez Masto, Jacky Rosen, Alex Padilla, Jeanne Shaheen, Adam Schiff, Martin Heinrich, and Ron Wyden sent a letter to CFTC Chairman Michael Selig demanding the agency swiftly ensure regulated exchanges are not listing event contracts letting users profit from active wildfires, citing both a perceived incentive for arson and the optics of profiting from community harm.
On its Q2 2026 earnings call, Cboe raised full-year organic revenue growth guidance to mid-to-high teens on a 30% options-revenue surge. Management laid out a two-phase Cboe Predicts roadmap: Phase 1 (Mini-S&P 500/XSP binary contracts, live since June) and Phase 2, a company-fundamentals binary suite (EPS, revenue, margins) across 23 mapped companies, for which Cboe filed with the SEC in July, targeting a September launch pending approval.
Binance.US said it plans to file a Designated Contract Market application with the CFTC in August 2026 to launch its own federally licensed prediction-markets product, positioning to compete with Kalshi and Polymarket. This is a stated intent to file, not yet a completed application.
IG Group agreed to acquire Underdog, owner of the CFTC-registered Aristotle Exchange DCM/DCO, for up to ~$1.3B (~$1.1B upfront, mostly IG shares plus ~$380M cash, plus a ~$200M earnout). Underdog is described as the third-largest US prediction-market venue by regulated volume, behind only Kalshi and Robinhood. Underdog had gone live on its own exchange (UDX, built on the Aristotle infrastructure it acquired in March) on July 18-20, ending reliance on third-party venues, and posted its first $1M+ single trading day on July 27. Underdog is not currently modeled as a platform competitor entity.
CME Group and FutureSports announced a long-term partnership to list cash-settled futures on FutureSports Performance Indexes, built from league-approved sports statistics and tradable 24/7 including during live games. First contracts are expected pending regulatory review, targeting stadium owners, sponsors, insurers, and broadcasters as hedgers rather than retail prediction-market bettors.
A day after a federal judge blocked Minnesota's statutory prediction-market ban (SF 4760) from taking effect, Gov. Tim Walz signed an executive order prohibiting state employees from using nonpublic or confidential information to trade on prediction-market platforms such as Kalshi and Polymarket, regardless of whether they profit. Violators face disciplinary action up to termination. The order is a narrower, governance-focused pivot after the broader ban was enjoined, rather than a renewed attempt to block the platforms outright.
As the comment period on the CFTC's prediction-markets rulemaking closed (upd-other-044), a coalition of 44 state attorneys general led by Ohio AG Andy Wilson filed a joint comment letter arguing the proposed rule 'goes well beyond' the agency's statutory authority under the Commodity Exchange Act, and that sports-wagering regulation has long been a state, not federal, function. Florida, Georgia, Missouri, New Hampshire, and Texas did not sign. The letter runs directly counter to the pro-preemption comment filed the same week by Hyperliquid's Multicoin-backed policy center and Coinbase (upd-other-044).
State AGsCFTCComment PeriodPreemptionSports Wagering
ProphetX, the CFTC-registered DCM/DCO sports-native prediction exchange, closed a $35M round led by Parlay Capital and Data Point Capital, with several smaller funds participating. Proceeds go toward product development and liquidity for its B2B/RFQ 'Parlay Mechanism'; the company is targeting a tripling of 2026 trading volume. ProphetX is not currently modeled as a platform competitor entity.
The bipartisan Wisconsin Elections Commission approved a legal memo (adopted July 9, made public July 21) concluding that trading on election outcomes via Kalshi or Polymarket likely qualifies as a 'bet or wager' under Wis. Stat. Section 12.13 — which disqualifies a person from voting in an election they bet on, and makes voting anyway a Class I felony. Kalshi publicly called the guidance 'bananas' and 'voter suppression' on July 27; Polymarket also pushed back. The commission is a distinct body from AG Kaul's office, whose separate April 2026 enforcement suit is already reflected on the platform.
Hyperliquid began letting any builder deploy prediction markets on-chain provided they stake 500,000 HYPE tokens (roughly $31.7M), locked for six months and slashable for poorly defined or incorrectly settled markets, starting on testnet ahead of mainnet. Deployers can earn up to 50% of trading fees. The move is framed explicitly as a challenge to Polymarket, and operates entirely outside the CFTC-regulated perimeter that governs every DCM on this platform.
Citadel Securities announced a $400M strategic investment in Crypto.com — its first institutional funding round — valuing the exchange at $20B. Crypto.com says the capital will accelerate expansion into tokenized securities, derivatives, and prediction markets via its CFTC-regulated Derivatives North America unit.
Kentucky's HB 904 took effect July 15, 2026, barring Kentucky-licensed sports wagering, horse racing, and fantasy-contest operators from contracting with or profiting off prediction-market platforms. It follows AG Russell Coleman's June 17 lawsuits against Kalshi, Polymarket, and a sweepstakes-casino operator (law-ky-ag-v-kalshi); a coalition including Kalshi and Crypto.com has separately sued to block the law on CEA-preemption grounds.
Zuckerberg met Kalshi CEO Tarek Mansour to discuss a Meta acquisition of Kalshi; talks broke down over valuation and Meta's internal concerns about the legal and regulatory complexity of real-money prediction markets, and Mansour declined to sell. Meta instead proceeded with its own play-money app, Arena (upd-other-041), and separately struck a deal to integrate Kalshi into Threads.
Sens. John Curtis (R-UT) and Adam Schiff (D-CA) sent a letter to CFTC Chairman Michael Selig demanding the agency state in writing whether it is investigating the deceptive-marketing conduct described in a Wall Street Journal investigation of Polymarket, giving the CFTC until July 10, 2026 to respond.
A third-party vendor supplying Polymarket's frontend code was compromised; attackers injected a malicious script that drained an estimated $2.9-3.1M from at least 11 user wallets. It is Polymarket's second security incident in two months, following a roughly $700,000 internal-wallet compromise in May tied to a six-year-old leaked private key — a recurring operational-integrity concern alongside the platform's separate oracle-conflict-of-interest issues.
The Financial Times reported on June 24, 2026 that KalshiEX LLC is in discussions to raise a new funding round at a valuation of approximately $40 billion — nearly double the $22 billion valuation at which it closed a $1 billion Series F in May 2026. A deal could close as early as Q3 2026. The new round, if completed, would mark an eightfold increase in Kalshi's valuation from approximately $5 billion in early 2025 and would widen its lead over rival Polymarket, which has separately been in discussions to raise capital at a $15 billion valuation. CEO Tarek Mansour separately confirmed in a public statement that an initial public offering is under active consideration, though no IPO is expected before 2027. The $40 billion figure implies a roughly 100x multiple on annualized revenue of approximately $2 billion as of June 2026. The valuation trajectory is occurring alongside active litigation in more than 15 states and the CFTC's own expanded federal enforcement posture, underscoring the market's assessment that federal regulatory primacy over prediction markets is increasingly likely to be sustained.
On June 23, 2026, Cboe Global Markets officially launched Cboe Predicts, its new prediction-markets product suite, with the first live contracts: yes/no binary options on the Mini-S&P 500 Index (XSP), listed under symbols XSPBW and XSPBX. Contracts pay a fixed $100 if XSP settles at or above (yes) or below (no) a specified level, and $0 otherwise. The products are immediately available through Interactive Brokers; Charles Schwab, which announced the partnership on June 19, 2026 (upd-other-038), is expected to offer access in the coming months, with additional retail brokerage platforms to follow. All contracts are listed on Cboe Options Exchange and centrally cleared by the Options Clearing Corporation (OCC) under the SEC regulatory framework for listed options — not the CFTC DCM framework used by Kalshi, Polymarket, and Robinhood Derivatives. Cboe has also announced a future expansion using its patent-pending Quoted Spread Book framework to package XSP vertical spreads into simpler, defined-risk formats for less experienced traders. The launch marks the first live trading of Cboe Predicts products and represents an alternative route to retail prediction-market exposure entirely outside the CFTC-designated-contract-market regulatory perimeter and the state gambling-law enforcement wave facing CFTC registrants.
The New York Times reported on June 23, 2026 that Meta Platforms has directed a small internal team to build a standalone smartphone app called 'Arena' — a prediction-markets product that asks users to forecast outcomes in politics, sports, entertainment, and world affairs. Unlike Kalshi and Polymarket, Arena would use a daily allotment of virtual play money rather than real-money wagers, an explicit design choice to remain outside the CFTC's designated-contract-market regulatory framework and state gambling-law exposure. The app would be separate from Facebook and Instagram and is described internally as experimental but a top priority; Mark Zuckerberg is personally involved. News of the project drove share-price declines in several prediction-market-adjacent companies at the open on June 23. Meta previously built a similar free-to-play product called Forecast in 2020, which was shut down in 2022. No launch date has been confirmed and launch is not guaranteed. Meta's points-only model would place it alongside non-regulated social-prediction products rather than in the CFTC-regulated event-contract space occupied by Kalshi and Polymarket.
Bloomberg reported on June 23, 2026 that KalshiEX LLC updated its member agreement (dated June 17, 2026) to formally prohibit users domiciled in, organized in, or located in India from trading event contracts on the platform, adding India to Kalshi's 55-jurisdiction restricted list. The compliance step follows a series of escalating Indian enforcement actions: India's Promotion and Regulation of Online Gaming Act 2025 (PROGA), effective May 1, 2026, classified prediction markets as prohibited online money games; on April 25, 2026, India's Ministry of Electronics and Information Technology (MeitY) sent Kalshi a formal warning letter and issued advisories to VPN providers; a May 18, 2026 Bloomberg report found that both Kalshi and Polymarket continued to onboard Indian users despite the ban (upd-other-026); and Polymarket was blocked at the ISP level by India around May 21, 2026. Kalshi's June 17 member-agreement update is its formal contractual compliance step — distinct from the prior MeitY advisory — and marks Kalshi's exit from what had been one of its largest non-US trading audiences, with an estimated $27.7 million in combined volume recorded during a single May IPL cricket match.
On June 19, 2026, the Wall Street Journal reported that Charles Schwab is working with Cboe Global Markets to offer yes-or-no binary options contracts on the S&P 500, marking one of the largest traditional brokerages' entry into the prediction-market sector. The product allows customers to wager on whether the S&P 500 closes above or below a specified level, with fixed $100 cash settlement if correct and a worthless expiration if not; a 'Plus Zone' feature offers partial payout when an outcome lands close to the target. Contracts are listed on Cboe Options Exchange and centrally cleared by OCC under the SEC regulatory framework, allowing Schwab to bypass CFTC designated-contract-market registration entirely. Schwab plans to limit its initial offering to the S&P 500 and other financial benchmarks, explicitly avoiding sports, politics, and entertainment — the categories driving the state-AG enforcement wave against CFTC-registered platforms. Cboe announced the underlying prediction-markets framework in March 2026 around a Mini S&P 500 Index contract, with a second-quarter 2026 launch target; the Schwab partnership extends that product to approximately 37 million client accounts representing $9.9 trillion in assets. Charles Schwab becomes the largest traditional financial institution to enter the prediction-market sector by client base, routing its entry through SEC-regulated options infrastructure rather than the CFTC DCM framework used by Kalshi, Polymarket, Robinhood Derivatives, and DraftKings.
Charles SchwabCboeS&P 500Binary OptionsEvent Contracts
On June 18, 2026, Wealthsimple launched Wealthsimple Predict, a standalone app giving Canadian retail investors access to approximately 4,000 Kalshi event contracts across climate, financial markets, and economic-indicator categories. The launch followed a March 2026 authorization from the Canadian Investment Regulatory Organization (CIRO), making Wealthsimple the second investment dealer approved by CIRO for prediction-market trading; sports and political contracts are excluded under CIRO's current scope. The partnership marks Kalshi's first international expansion via a licensed foreign broker-dealer. Separately, on June 19, 2026, multiple outlets reported that Kalshi's annualized revenue has surpassed $2 billion — more than triple the figure from November 2025 — driven by strong World Cup and NBA Finals trading volume. Kalshi executives have held preliminary, informal discussions with investment banks about a potential initial public offering, though the company is not expected to pursue an IPO before late 2027 or 2028. The revenue milestone and international expansion come as Kalshi simultaneously contests state-by-state regulatory enforcement in more than 15 US jurisdictions.
U.S. District Judge Paul L. Maloney of the Western District of Michigan issued two nearly identical rulings on June 17, 2026, denying preliminary injunctions sought by QCX LLC d/b/a Polymarket US and Robinhood Derivatives LLC to block Michigan from enforcing its Lawful Sports Betting Act against their sports-event contract offerings. Judge Maloney held that sports-event contracts are not 'swaps' within the meaning of the Commodity Exchange Act and Dodd-Frank Act, finding the statutory term 'swap' ambiguous and applying the presumption against federal preemption of traditional state police powers over gambling. He wrote that 'Congress enacted the statute to regulate over-the-counter derivatives markets following the 2008 financial crisis' and concluded that Congress lacked any 'clear statement' of intent to displace state gambling regulation through the swap definition. Both Polymarket and Robinhood failed to show a likelihood of success on the merits, and their requests for emergency injunctive relief were denied. The Michigan rulings are the first federal court decisions to hold that sports-event contracts are not swaps and stand in direct conflict with the Third Circuit's April 6, 2026 ruling in Kalshi v. Flaherty (No. 25-3325), which found that Kalshi's sports-event contracts likely qualify as swaps and that the CFTC has exclusive jurisdiction to regulate them. The resulting inter-district conflict on the same legal question sharply increases the likelihood of en-banc review or Supreme Court intervention.
On June 16, 2026, the U.S. Court of Appeals for the Sixth Circuit denied a motion by the CFTC to participate as amicus curiae during oral arguments in KalshiEX LLC v. Schuler et al. (No. 26-3196), the consolidated appeal of the Ohio federal district court's denial of Kalshi's preliminary injunction against state gaming enforcement. The court will proceed with oral argument on July 30, 2026 — as previously scheduled — but the CFTC will have no direct voice in the proceeding. The denial is significant because the CFTC had filed a written amicus brief in May 2026 asserting exclusive federal jurisdiction (PR 9230-26), and the agency had sought to extend that argument into oral advocacy. The Sixth Circuit has now received amicus briefs from former CFTC/SEC Chair Gary Gensler, a 38-state AG coalition, Native American tribal associations, the American Gaming Association, and Better Markets — all opposing the CFTC's preemption theory — while the court has now restricted the CFTC itself from oral participation. Oral argument remains set for July 30, three days after the CFTC's NPRM comment period closes on July 27.
California AG Rob Bonta led a bipartisan coalition of 38 state attorneys general in filing an amicus brief on June 14, 2026, with the U.S. Court of Appeals for the Sixth Circuit in KalshiEX LLC v. Schuler (No. 26-3196), supporting Ohio's authority to enforce its gaming and sports-betting laws against Kalshi's CFTC-registered event contracts. The brief argues that neither the Commodity Exchange Act nor Dodd-Frank preempts state gambling regulation and that Kalshi's theory of exclusive federal jurisdiction would effectively displace traditional state police powers over gaming. The filing follows parallel amicus briefs by former CFTC/SEC Chair Gary Gensler (June 11–12), the Indian Gaming Association, multiple Native American tribal organizations, and the American Gaming Association. The Sixth Circuit also issued a scheduling order setting oral argument for July 30, 2026 — three days after the CFTC's NPRM comment period closes (July 27). Texas was not among the signatories. The multi-state coalition represents the sixth major amicus filing against Kalshi's preemption theory in the Sixth Circuit proceeding.
Gary Gensler, former chair of both the CFTC (2009–2014) and SEC (2021–2025), filed an amicus brief on June 11–12, 2026, with the U.S. Court of Appeals for the Sixth Circuit in KalshiEX LLC v. Schuler (No. 26-3196), arguing that neither the Commodity Exchange Act nor Dodd-Frank grants the CFTC authority to preempt state sports-betting regulation. Gensler argued that Congress never intended to displace state gaming frameworks when it enacted the swap definition in Dodd-Frank, citing that Senator Harry Reid of Nevada — whose state's economy depends on gaming — "would never have consented to or passively accepted legislation displacing an activity so critical to his state's economy and politics by permitting sports betting only under CFTC auspices." He characterized the current CFTC's hedging rationale for sports-betting event contracts as only weakly connected to genuine commercial risk management. The Indian Gaming Association, multiple Native American tribal organizations, the American Gaming Association, and Better Markets filed parallel amicus briefs supporting Ohio's authority to enforce its gaming laws. Gensler discussed the filing on CNBC's Squawk Box on June 11. His brief is the most prominent individual opposition to the CFTC's preemption theory and marks the first time a former chair of either agency has publicly opposed the CFTC's prediction-market jurisdiction claims in a live appellate proceeding.
Sen. Elizabeth Warren (D-MA) sent a letter to CFTC Chairman Michael Selig on June 10, 2026 demanding internal records by June 18 regarding the agency's prediction-market and crypto oversight capacity. Warren cited a 25% workforce reduction and a drop in enforcement actions from 58 to 11, calling the weakened CFTC "a recipe for disaster." The letter alleges the agency approved a Polymarket request following an investment by a firm connected to Donald Trump Jr., and criticizes Selig for seeking to vacate a $5 million penalty against Gemini, whose founders each donated $1 million in Bitcoin to Trump's reelection campaign. Warren requested records of communications between the CFTC and prediction-market and crypto firms, and a list of staff placed on administrative leave. The letter coincides with the publication of the CFTC's prediction-markets NPRM (upd-cftc-046) and comes as Congress advances the Clarity Act.
Kalshi announced on June 9, 2026 a package of market-integrity measures effective immediately, based on recommendations from an independent Surveillance Audit Committee established in February 2026 to oversee its enforcement program. The measures require traders in higher-risk markets — those scored for factors such as corporate performance metrics, national-security implications, product launches, and outcome concentration — to disclose their employer. Kalshi simultaneously launched a whistleblower tip line routed directly to its 24/7 surveillance team and published its first enforcement transparency report, disclosing that in Q1 2026 it blocked more than 100 potential insider trades, conducted over 150 investigations, and made 20 referrals to law enforcement. The announcement follows congressional pressure from the Amo-Casar letter (upd-other-030), the Van Dyke enforcement action (enf-cftc-vandyke), the Santos-Kalshi DOJ investigation (enf-doj-santos), and broader scrutiny of prediction-market market integrity. Kalshi is the first CFTC-registered DCM to publish platform-level insider-trading metrics.
Reps. Gabe Amo (D-RI-01) and Greg Casar (D-TX-35) sent a letter to CFTC Chairman Michael Selig on June 8, 2026 demanding an explanation of the agency's response to blockchain analytics firm Bubblemaps' findings — first reported by CBS News 60 Minutes (upd-other-022) — that nine linked anonymous Polymarket accounts collectively earned $2.4 million wagering on US military operations against Iran with a 98% win rate across more than 80 bets. The letter asks Selig to clarify what authority the CFTC believes it has to investigate insider trading on prediction-market platforms tied to national-security events and why no public enforcement action has been opened against the accounts. The demand follows a series of similar congressional letters since April 2026 and the CFTC's Van Dyke enforcement action for Maduro-capture insider trading.
Rep. Bryan Steil (R-WI), chair of the House Administration Committee, told reporters on June 5, 2026 that he is drafting legislation to prohibit current and former members of Congress and candidates for federal office from trading on prediction markets tied to elections, political outcomes, and policy matters — topics where they could possess material nonpublic information. Steil does not propose to restrict nonpolitical bets such as those on sporting events. He plans to attach the language to H.R. 7008, the pending bill that would ban lawmakers from individual stock trading. The announcement follows the Senate's April 30 unanimous-consent rule banning senators and staff from prediction-market trading and is the first formal Republican-led House legislative effort on the topic. Final bill text and timing remain under discussion with House GOP leadership.
The House Armed Services Committee passed the FY2027 National Defense Authorization Act 44–12 on June 4, 2026, following a 14-hour markup. The $1.15 trillion bill includes the military prediction-market trading provision first published in draft on June 2 (upd-other-026), which would require Defense Secretary Hegseth to issue regulations barring armed forces members and Pentagon civilian employees from trading prediction markets while possessing nonpublic information — including unclassified information such as contract awards — with criminal penalties under the UCMJ. The provision was drafted in direct response to the April 2026 CFTC and DOJ charges against Army Special Forces Master Sergeant Gannon Van Dyke (PR 9217-26). The NDAA now advances to the full House for floor consideration; if enacted, it would be the first federal statute specifically addressing insider trading on prediction markets.
New Mexico Attorney General Raúl Torrez filed suit in the 1st Judicial District Court in Santa Fe on June 4, 2026, alleging Kalshi's sports event contracts constitute unlicensed sports betting under the New Mexico Gaming Control Act. The complaint notes Kalshi allows users as young as 18 to participate, three years below New Mexico's 21+ gaming minimum, and that the company has not applied for a state gaming license. The suit follows the May 12, 2026 federal IGRA complaint filed by four New Mexico tribes and pueblos and makes New Mexico the latest state to classify prediction-market sports contracts as unauthorized sports wagering.
New MexicoAG LawsuitSports BettingUnlicensed GamingTorrez
A coalition of nine House Democrats led by Reps. Kevin Mullin (CA-15) and Gabe Vasquez (NM-2) — joined by Carbajal, Foushee, Huffman, Levin, Ruiz, Titus, and Tonko — sent a letter to the Federal Trade Commission on June 3, 2026 requesting a formal investigation into whether Kalshi and Polymarket are engaging in deceptive practices. The lawmakers allege the platforms present contradictory identities to regulators versus the public: they describe event contracts as financial instruments in CFTC regulatory filings while using sports-betting language and imagery in consumer advertising. The letter gives the FTC until June 29 to clarify whether it will open a formal probe or take enforcement action. The inquiry is the first FTC-directed congressional request specifically targeting prediction market operators and is independent of the ongoing CFTC rulemaking and state enforcement actions.
Illinois Senate Bill 3019 enacted a per-wager exchange tax on sports prediction markets as part of the state's FY2027 omnibus budget: 1.75% on each exchange wager up to 5 million wagers per fiscal year, and 3.5% on each wager thereafter. The bill defines 'exchange wager' to include agreements on a prediction market tied to a sporting contest, creating a tax parallel to Illinois's existing sportsbook revenue regime. The measure also establishes a daily fantasy sports regulatory framework. Legal analysts note the CFTC's exclusive-jurisdiction position would likely render the tax unenforceable against CFTC-registered DCMs pending the outcome of CFTC v. Illinois — adding compliance uncertainty for operators in the state.
Draft text released June 2, 2026 by the House Armed Services Committee for the National Defense Authorization Act includes a provision requiring Defense Secretary Hegseth to issue regulations prohibiting members of the armed forces and Pentagon civilian employees from trading on prediction markets when they possess relevant nonpublic information — including unclassified information such as contract awards. The provision, which explicitly contemplates criminal punishment under military law, was drafted in direct response to the April 2026 CFTC and DOJ charges against Army Special Forces Master Sergeant Gannon Van Dyke (PR 9217-26), who allegedly used classified knowledge of Operation Absolute Resolve to profit $404,000 on Polymarket. The bill would require Hegseth to develop a range of punishments for violations and applies to unclassified but nonpublic information, going beyond existing classified-information handling rules.
President Trump posted on Truth Social on May 26, 2026, stating it is 'critically important that the CFTC's exclusive authority over Prediction Markets is maintained, and that they will thrive.' He framed the administration as 'setting rules of the road that are the Gold Standard for the States' and warned that foreign competitors are seeking to capture leadership in the prediction-market sector. Trump explicitly named state-level opponents — including former NJ Gov. Christie, NY AG James, MN Gov. Walz, and IL Gov. Pritzker — and called them 'scum.' The statement is the most direct White House endorsement of CFTC jurisdiction to date and came as the CFTC's litigation against six states was ongoing and a comprehensive event-contract proposed rulemaking was under White House OIRA review.
The Senate Commerce Subcommittee on Consumer Protection, Technology, and Data Privacy held its first formal prediction-market hearing, chaired by Sen. Ted Cruz (R-TX). Witnesses representing the industry (Patrick McHenry for the Coalition for Prediction Markets), sports leagues, and other stakeholders were questioned on sports integrity, youth access, and the adequacy of CFTC self-certification. Senators on both sides raised concerns about a 15-year-old Kalshi brand partner, match-fixing allegations tied to prediction-market contracts, and whether federal or state oversight is appropriate. The hearing marks the first formal congressional scrutiny of prediction markets in the 119th Congress.
Senate HearingCruzSports IntegrityConsumer Protection119th Congress
QCX LLC d/b/a Polymarket US, a CFTC-regulated DCM, filed a self-certification for a new contract class called Combinatoric Athletic Outcome Contracts (CAOC). Each CAOC bundles two or more underlying event contracts: the contract pays $1.00 only if every leg resolves as specified, and $0.00 if any single leg fails — a binary parlay structure. Polymarket plans to list CAOCs no earlier than May 21, 2026; the CFTC has 10 business days to object. CAOCs represent Polymarket's first structural expansion beyond single-event binary contracts and introduce a product class without direct CFTC precedent, raising design-of-contract review questions at a time of heightened congressional scrutiny.
JPMorgan circulated compliance guidance to approximately 320,000 employees in May 2026 authorizing participation in prediction markets while imposing specific restrictions. Staff are directed to avoid trading contracts tied to JPMorgan-specific events — stock price, earnings, regulatory filings, and leadership changes — on grounds that such positions could be perceived as misuse of material non-public information. The guidance does not require pre-clearance, notable for an institution that pre-clears nearly all other employee investments. The memo stops short of an outright ban and follows increased scrutiny after the CFTC's April 2026 Van Dyke insider-trading enforcement action. JPMorgan is the first major US bank to issue explicit guidance permitting employee prediction market participation.
Sporttrade announced it will close sportsbook operations in New Jersey, Arizona, Colorado, Iowa, and Virginia on May 25, 2026, with all platform access ending June 26. The move follows a February 2026 dual DCM/DCO application to the CFTC — which remains in the 180-day review window — and represents a full pivot to a federally regulated prediction-market model. Sporttrade is among the 17+ applicants in the spring 2026 DCM pipeline.
Governor Tim Walz signed the omnibus public safety bill (SF 4760) into law on May 18, 2026, making Minnesota the first US state to statutorily ban prediction markets. The law makes operating or assisting in the operation of a prediction market a criminal felony; provisions take effect August 1, 2026. The law is broader in scope than any prior state action, covering sports, elections, weather, terrorism, and entertainment contracts. The CFTC filed a preemption suit (PR 9233-26) the following day seeking a preliminary injunction to block enforcement before the effective date.
Kalshi became the first prediction-market member of the National Council on Problem Gambling, with a two-year, $2 million commitment funding the council's new "Financial Services & Trading" subcategory. CEO Tarek Mansour framed the move as a commitment to "trader health and safety" while maintaining that Kalshi is not a gambling platform. Coincides with the Kalshi-IC360 "SelfExclude" launch and the USPTO trademark filing controversy.
A Wall Street Journal investigation into Polymarket's UMA oracle dispute-resolution system found that at least 60% of active UMA voters could be linked to Polymarket accounts. In more than 300 disputes — nearly one in five — at least one voter held a financial stake in the outcome. Direct operational and integrity risk for Polymarket; relevant to compliance dashboards.
India's Ministry of Electronics and Information Technology (MeitY) sent formal advisories to VPN service providers on May 18, 2026, explicitly naming Polymarket and similar US prediction market platforms as "illegal and blocked" under the Promotion and Regulation of Online Gaming Rules (PROGA), which took effect May 1. Despite the federal warning, both Kalshi and Polymarket continue to onboard Indian users; Kalshi's legal counsel said the company has not received a direct shutdown order and remains in communication with Indian authorities. A May 7 IPL cricket match attracted an estimated $27.7 million in combined trading on both platforms. The episode highlights compliance and reputational risk for US operators pursuing international expansion without local regulatory clearance.
Data analytics firm Bubblemaps, in findings first shared with CBS News / 60 Minutes, identified nine linked anonymous Polymarket accounts that collectively earned $2.4 million wagering on US military operations against Iran, achieving a 98% win rate across more than 80 bets. The accounts were created in the days before the first US strikes on Iran in late February 2026 and correctly predicted the timing of strikes, the removal of Supreme Leader Khamenei, and the ceasefire announcement. Polymarket said it cooperates with law enforcement when suspicious activity is detected. The episode closely parallels the CFTC's Van Dyke / Maduro insider-trading case charged in April 2026 and raises renewed calls for CFTC scrutiny of platform surveillance obligations.
NFL Senior Vice President Brendon Plack sent Chairman Selig a letter urging bans on "objectionable" contracts (incomplete passes, injuries, broadcast events, celebrity attendance), a minimum age of 21 (up from 18), CFTC certification of player-performance contracts (no self-certification), league sign-off on contract listings, and a ban on margin trading for sports markets. Joined by NBA on the age-21 push.
Virtu Financial began pricing and trading event contracts on Kalshi and CME Group, joining a small but growing list of institutional market-makers in prediction markets. Confirms HFT market-maker adoption and is meaningful for liquidity and spread metrics; follows Jump Trading's role in the May 4 first-ever institutional block trade on Kalshi.
Interactive Brokers launched a unified interface routing across Kalshi, CME Group, and ForecastEx in a single trading screen with best-net-price routing. ForecastEx positions held in IBKR earn a ~3.14% APY incentive coupon. Initial focus is elections, climate, and economic indicators. Reframes ForecastEx as one of three "house" venues inside IBKR rather than the sole offering.
Minnesota's omnibus public safety bill (SF 4760) — which includes a prediction-markets ban making organizing such markets a felony — passed both chambers (Senate 57-9, House 100-32) and was sent to Gov. Walz. The measure grants state regulators authority to issue cease-and-desist orders and seek injunctions. Provisions effective Aug. 1, 2026. CFTC suit reportedly under consideration; Minnesota would be the first US state to statutorily outlaw prediction-market exchanges.
Senators John Curtis (R-UT) and Adam Schiff (D-CA) introduced a bipartisan bill amending the Commodity Exchange Act to bar CFTC-registered entities from listing contracts that "closely resemble sports bets or casino-style games." Joins at least eight pending state/federal prediction-market restrictions. Filed the same day Selig appeared at Brookings.
Curtis-SchiffBipartisanSports Bet BanCEA Amendment
The Mescalero Apache Tribe and the Pueblos of Isleta, Pojoaque, and Sandia filed a federal complaint in the District of New Mexico alleging Kalshi's sports contracts violate the Indian Gaming Regulatory Act, tribal gaming compacts, and tribal sovereignty by enabling Class III gaming on Indian lands. The suit seeks injunctive relief and damages and opens a second tribal IGRA front after Ho-Chunk Nation v. Kalshi in Wisconsin.
US District Judge William Conley (W.D. Wisc.) granted partial motions to dismiss (Lanham Act, RICO) but allowed the Ho-Chunk Nation's IGRA and state-law claims to proceed against Kalshi and Robinhood, finding the tribe "likely to succeed on the merits" though denying a preliminary injunction. First federal ruling siding with tribal plaintiffs in Kalshi sports-contract litigation. Trial set for May 24, 2027. Opens a tribal-sovereignty front distinct from state-AG enforcement.
The US Court of Appeals for the Fourth Circuit heard oral argument in Maryland Lottery and Gaming Control Commission v. Kalshi. Judge Roger Gregory: "If it quacks, you know, it's a duck, right? It's gambling." Kalshi was represented by Neal Katyal; the CFTC backed Kalshi via amicus, while 38 state AGs (lead Nevada's Aaron Ford) backed Maryland. Ruling under advisement.
Kalshi closed a $1 billion Series F led by Coatue with Sequoia, a16z, Paradigm, IVP, Morgan Stanley, and ARK Invest participating. The valuation roughly doubled from $11B five months earlier. The company disclosed institutional volume up 800% over six months and annualized notional volume rising from $52B to $178B, with reported annualized revenue exceeding $1.5B.
US District Judge John C. Coughenour (W.D. Wash.) issued a remand order sending Washington's enforcement case against Kalshi back to King County Superior Court, rejecting Kalshi's federal-question removal grounds. Kalshi subsequently filed a stay motion pending appeal to the Ninth Circuit. The WA Gambling Commission's December 2025 guidance remains in force.
Washington StateRemandRemoval RejectedFederal Court
The Massachusetts Supreme Judicial Court heard oral argument in Kalshi's appeal of the February 2026 state-court preliminary injunction. Justices, including Justice Kafker who told Kalshi's counsel "I just feel like you're swimming upstream here," pressed the company on whether sports contracts differ from sports betting. The CFTC filed an amicus brief on April 24 supporting Kalshi; 38 state AGs filed against. Ruling expected within ~4 months.
Payward, the parent of Kraken, closed its acquisition of Bitnomial for up to $550M in cash and stock, gaining Bitnomial's CFTC-licensed futures broker, exchange, and clearinghouse — a "trifecta" of US derivatives licenses. Kraken plans to start with spot margin on the exchange/NinjaTrader, with perpetuals and options to follow. Bitnomial leaves the independent DCM landscape.
Maryland AG Anthony Brown led a bipartisan coalition of 41 state AGs in submitting a formal comment to the CFTC's prediction-market rulemaking, arguing "any distinction between sportsbook bets and prediction-market bets is illusory" and that sports event contracts fall outside CFTC jurisdiction. The coalition includes Colorado AG Phil Weiser among others.
Senators Kirsten Gillibrand (D-NY) and David McCormick (R-PA) introduced S.4188, a bipartisan bill banning federal elected officials, political appointees, congressional employees, and senior executive-branch staff from trading event contracts when in possession of material non-public information. The bill empowers the CFTC to ban contracts on war/violence/terror as contrary to the public interest, requires age verification at 18+, and creates a CFTC Advisory Council on Consumer Protection.
Clear Street announced a strategic partnership making it the first institutional Futures Commission Merchant to join Kalshi's exchange and clearing house, including swap capabilities for ETF issuers structuring listed products around prediction markets. The deal opens regulated clearing, settlement, and block-trade risk transfer for institutional clients.
The US Senate passed by unanimous consent a rule banning senators and staff from trading prediction-market contracts, effective immediately. The action followed insider-trading concerns including the indictment of a Special Forces sergeant over Maduro-capture bets and Iran-ceasefire-timing trades. Kalshi CEO Tarek Mansour publicly applauded the resolution. House action and a possible White House follow-on rule reportedly under consideration.
Eight Democratic senators led by Jeff Merkley (with Blumenthal, Van Hollen, Whitehouse, Heinrich, Rosen, Smith, and Raskin) sent CFTC Chair Selig a letter demanding the agency issue a rule prohibiting certain sports and political event contracts, citing insider-trading concerns and consumer harm. Filed the same day the ANPRM comment window closed; establishes a formal Democratic record into the docket.
A bipartisan coalition of 38 state AGs plus DC, led by NV AG Aaron Ford and OH AG Dave Yost, filed an amicus brief at the Massachusetts Supreme Judicial Court supporting AG Campbell's enforcement against Kalshi. The brief argues states have traditionally regulated gambling and that Kalshi's preemption theory threatens state police powers. Texas notably did not join.
The NY State Gaming Commission advanced a proposal that would impose state-level rules on prediction markets and issued a public warning advising New Yorkers to refrain from making sports trades on prediction-market platforms or other unregulated venues. The action coincides with the CFTC's April 24 suit against the Commission and other state officials.
Kalshi launched its first crypto perpetual futures product in NYC under the codename "Timeless," initially listing Bitcoin and several other cryptocurrencies collateralized with USD. Stablecoin collateral is planned for Q2. The launch marks Kalshi's first venture beyond binary event contracts and pushes it directly into competition with Coinbase, Kraken/Bitnomial, and Robinhood.
Following the CFTC's same-day suit against New York, AG Letitia James and Governor Kathy Hochul issued a joint statement accusing the Trump administration of "prioritizing big corporations over consumers" and vowing to defend NY gambling laws in court. They reiterated that prediction markets violating state law would be held accountable.
Wisconsin AG Josh Kaul filed three separate civil complaints in Dane County Circuit Court alleging the five prediction-market operators run unlicensed sports wagering in violation of Wis. Stat. 945.03(1m). Complaints cite that sports contracts generate roughly 90% of Kalshi's revenue and seek injunctive relief rather than monetary damages. Wisconsin becomes a new state in the enforcement coalition.
Polymarket unveiled perpetual futures on crypto, equities (Nvidia), commodities (gold), and other traditional assets with leverage selectors from 7x to 10x — its first non-binary product set. Launch beat Kalshi's perpetual debut by six days, escalating direct competition with Robinhood, Coinbase, and Kraken and raising fresh CFTC scrutiny over leverage on US-facing products.
The Ohio Casino Control Commission issued a notice of intent to impose a $5 million civil penalty on Kalshi for continued unlicensed sports betting in Ohio, citing ongoing offerings to customers aged 18-20 and the operator's refusal to halt activity after the original cease-and-desist. The notice is the largest state monetary action against a prediction-market operator to date.
Arizona AG Kris Mayes filed 20 misdemeanor counts against KalshiEX LLC in Maricopa County Superior Court, including four counts of election wagering and 16 counts of unlawful betting. The filing is the first criminal prosecution of a CFTC-registered prediction market operator in the United States.
The Tennessee Sports Wagering Council sent cease-and-desist letters to KalshiEX, Polymarket, and Crypto.com Derivatives NA, deeming sports event contracts "wagers" under the Tennessee Sports Gaming Act and demanding refunds to Tennessee customers by January 31, 2026. Kalshi sued the same day; the Middle District of Tennessee granted a TRO on January 12.
U.S. District Judge Andrew Gordon dissolved the seven-month preliminary injunction that had allowed Kalshi to continue Nevada operations and denied Robinhood's parallel motion, citing "new law" and "new facts." The order permits the Nevada Gaming Control Board's original cease-and-desist to take effect.
The New York State Gaming Commission issued a cease-and-desist requiring Kalshi to stop offering sports event contracts on tournament winners and player statistics, classifying them as unlicensed sports wagering under New York Racing Law § 1367-a. Kalshi responded by filing a federal preemption suit against the Commission three days later.
A Massachusetts superior court granted AG Campbell's preliminary injunction prohibiting Kalshi from accepting online sports wagers and related event contracts from Massachusetts customers until the company is licensed by the Massachusetts Gaming Commission.
MassachusettsPreliminary InjunctionLicensingCourt Order
Attorney General Andrea Joy Campbell filed suit in Suffolk Superior Court alleging Kalshi runs an unlicensed sports-wagering operation, accepts wagers from 18–20-year-olds below the Commonwealth's 21+ threshold, and lacks compliant responsible-gambling tools. The complaint seeks injunctive relief and civil penalties.
U.S. District Judge Adam Abelson denied Kalshi's motion for a preliminary injunction against the Maryland Lottery and Gaming Control Commission, marking Kalshi's first preemption loss after early wins in New Jersey and Nevada. Kalshi filed a notice of appeal to the Fourth Circuit on August 5, 2025.
Attorneys general from 34 states, DC, and the Northern Mariana Islands filed an amicus brief in Kalshi v. Flaherty arguing the Commodity Exchange Act was not designed to displace state consumer-protection and gambling regimes for sports wagers. The brief was co-led by the Ohio and Nevada AGs.
Amicus BriefThird CircuitState AG CoalitionFederalism
The Arizona Department of Gaming ordered Kalshi to cease all gambling operations in the state, joining a growing list of regulators treating sports event contracts as unlicensed sports wagering under state law.
The Maryland Lottery and Gaming Control Commission ordered Kalshi, Robinhood, and Crypto.com to halt sports event contracts for Maryland residents, citing statutory sports-wagering definitions as well as age-verification and geolocation requirements. Maryland followed NJ, NV, IL, and Ohio in acting within days of each other.
The Illinois Gaming Board sent cease-and-desist letters to KalshiEX, Robinhood Derivatives, and Crypto.com Derivatives NA, asserting the operators engaged in unlicensed sports wagering under the Illinois Sports Wagering Act and Criminal Code. Official letters are published on the IGB site.
The Ohio Casino Control Commission ordered Kalshi, Robinhood Derivatives, and Crypto.com Derivatives NA to halt sports event contracts for Ohio residents, finding the products meet the statutory definition of sports gaming and require licensure. The operators had been offering the contracts without an Ohio sports-betting license since January 2025.
The New Jersey Division of Gaming Enforcement ordered KalshiEX LLC and Robinhood Derivatives to halt sports event contracts for NJ residents, alleging the products constitute unauthorized sports wagering under the NJ Sports Wagering Act. Operators were given until 11:59 p.m. ET on March 28, 2025 to comply.
New JerseyCease & DesistSports Event ContractsUnauthorized Wagering
The Nevada Gaming Control Board issued a cease-and-desist demanding Kalshi stop offering sports-related prediction-market contracts to Nevada residents, contending that NRS Chapter 463 applies regardless of CFTC designation. Kalshi responded with a federal suit and initially obtained a preliminary injunction.
