The federal government on Thursday sued Arizona, Connecticut, and Illinois to stop their regulation of prediction markets, arguing that it holds jurisdiction over event contracts traded on federally registered platforms.
The Commodity Futures Trading Commission (CFTC) said the three states have attempted to ban, regulate, or restrain the activities of designated contract markets that offer trading in lawful event contracts—a legally binding “yes or no” bet on the outcome of real-world events. The agency says that such attempts by the states undermine its authority under the Commodity Exchange Act.
