The Commodity Futures Trading Commission has moved to intervene in the U.S. District Court for the District of Rhode Island to stop the state from applying gambling laws to CFTC-registered contract markets. The agency framed the filing as a defense of its exclusive jurisdiction over event contracts and prediction markets, arguing that the Commodity Exchange Act preempts state laws that purport to regulate designated contract markets. The filing follows a complaint brought late the previous week by a CFTC-registered designated contract market that said it faced imminent unlawful state enforcement. Rhode Island then filed its own complaint in a parallel state case seeking significant civil penalties and demanding that prediction markets cease operations and disgorge profits. The CFTC described the Rhode Island matter as the latest in a series of state challenges to its jurisdiction, following litigation in Arizona, Connecticut, Illinois, New York, and Minnesota.
Commodity Futures Trading Commission2026-05-28
Commodity Futures Trading Commission moves to intervene in Rhode Island case to block state gambling law action against CFTC-registered prediction markets
The Commodity Futures Trading Commission has moved to intervene in the U.S. District Court for the District of Rhode Island to prevent the state from applying gambling laws to CFTC-registered contract markets, asserting that the Commodity Exchange Act preempts such state regulation of designated contract markets and event contracts. The action follows parallel federal and state complaints involving a CFTC-registered designated contract market facing threatened state enforcement, which the CFTC calls part of a broader pattern of state challenges to its jurisdiction.