CFTC Takes Federal Action Against State Regulators Over Prediction Markets

The Commodity Futures Trading Commission (CFTC) has taken a significant step in its fight for regulatory control over prediction markets by filing a lawsuit against the state of New York.

The agency is seeking a declaratory judgment and a permanent injunction to prevent the application of state gambling laws to CFTC-registered contract markets. Chairman Michael Selig emphasized that the CFTC is defending its sole regulatory jurisdiction over these platforms, which it claims are subject to federal oversight.

This development adds New York to the growing list of states facing federal action over event contracts. The case aims to assert federal preemption and reduce state-level enforcement risk for cryptocurrency and decentralized finance (DeFi) prediction platforms.