Kalshi sues Minnesota, joins forces with CFTC to defend the legal status of prediction markets

ChainCatcher reports, according to CoinDesk, that prediction market platform Kalshi has filed a federal lawsuit against a new Minnesota law that will take effect on August 1, which classifies operating, hosting, or promoting prediction market platforms as a criminal offense. Kalshi argues that the law is unconstitutional, claiming it infringes upon the exclusive federal jurisdiction over derivatives markets granted to the CFTC by the Commodity Exchange Act and violates the First Amendment by restricting advertising.

Previously, on May 19, the CFTC filed a motion asserting that the state legislation is also unconstitutional. U.S. President Trump has also publicly expressed support for the CFTC's sole regulatory authority over prediction markets. Kalshi has previously won preliminary injunctions against similar enforcement actions in New Jersey and Arizona.