Tech · CNBC Technology
CFTC sues Arizona, Connecticut, Illinois over prediction market regulation
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A federal commission on Thursday announced lawsuits against three states over its ability to exclusively regulate prediction markets.
Key facts
- Sabrina Perel, the NFL's chief compliance officer, asked prediction market operators to block event contracts that are deemed "objectionable" in a letter obtained by CNBC
- The Morning Squawk newsletter by Alex Harring is your rundown of five things to know before the stock market opens
- CFTC has the "exclusive" authority to oversee event contracts through the Commodity Exchange Act, the commission said in a release
- The CFTC's lawsuits come amid mounting scrutiny of prediction markets on Capitol Hill and elsewhere as platforms like Kalshi and Polymarket skyrocket in popularity
Summary
The Commodity Futures Trading Commission said it was taking Arizona, Connecticut and Illinois to court over what it described as the states' actions "against" contract markets that were registered with the organization. CFTC has the "exclusive" authority to oversee event contracts through the Commodity Exchange Act, the commission said in a release. Congress has granted the CFTC — rather than individual states — the sole authority to regulate these markets, the body said. "This is not the first time states have tried to impose inconsistent and contrary obligations on market participants," CFTC Chairman Michael Selig said in a statement.