The Commodity Futures Trading Commission has sued Minnesota to stop a new state law that would make operating or assisting in the operation of a prediction market a criminal felony. The agency is seeking a preliminary injunction to prevent the law, signed by Governor Tim Walz, from taking effect on August 1, 2026. The CFTC argues that the Minnesota measure would criminalize activity in many CFTC-regulated markets and reaches further than the state laws it has challenged so far, including by covering weather-related event contracts. The agency linked that point to Minnesota’s role as a major agricultural producer, noting that such contracts are used for hedging. The filing follows a recent preliminary injunction issued by a federal court in Arizona against that state’s use of gambling laws to prosecute prediction market operators, and sits alongside CFTC lawsuits against Connecticut, Illinois, and New York, as well as amicus briefs filed in the Sixth and Ninth Circuits and the Supreme Judicial Court of Massachusetts.
Commodity Futures Trading Commission2026-05-19
Commodity Futures Trading Commission sues Minnesota to block state felony ban on prediction markets including weather event contracts
The Commodity Futures Trading Commission has sued the State of Minnesota and is seeking a preliminary injunction to block a new state law that would make operating or assisting in the operation of a prediction market a felony. The CFTC argues the law would criminalize activity in many CFTC-regulated markets, including weather-related event contracts used for hedging, and notes this action follows similar challenges to state gambling laws in Arizona, Connecticut, Illinois, New York, and other jurisdictions.