Lawsuit reaffirms the CFTC’s continued commitment to preserving exclusive jurisdiction over prediction markets
The Commodity Futures Trading Commission (CFTC) has sued New Mexico, one week after the state’s attorney general filed an illegal gambling lawsuit against Kalshi.
Friday’s filing by the CFTC aims to block the state’s efforts to apply state gambling laws against CFTC-registered contract markets.
New Mexico’s lawsuit was filed on June 4 and accuses Kalshi of unlawfully offering online sports betting while attempting to evade state gaming laws.
Similar to its interventions in other states, the CFTC argues that it has “clear and longstanding exclusive jurisdiction to regulate event contracts and the prediction markets on which they trade under the Commodity Exchange Act”, which pre-empts state law.
“New Mexico is the latest state seeking to nullify black letter law and decades of judicial precedent by imposing state gaming laws on federally regulated derivatives exchanges subject to the CFTC’s exclusive jurisdiction,” said CFTC chairman Michael Selig.
“As I’ve said repeatedly, the CFTC has the expertise and responsibility to protect its exclusive jurisdiction over commodity derivatives, and that’s exactly what we’ll continue to do.”