CFTC sues New Mexico over prediction market jurisdiction
The CFTC sued New Mexico Governor Michelle Lujan Grisham, Attorney General Raúl Torrez, and state gaming officials to stop the state from enforcing gaming laws against CFTC-registered prediction markets like Kalshi. New Mexico had sued Kalshi on June 4, alleging it was offering unlicensed sports betting and allowing users under 21 to trade. The CFTC says event contracts are federally regulated “swaps” and that Designated Contract Markets fall under its exclusive jurisdiction, so state laws cannot block them. New Mexico is the eighth state the CFTC has sued after state enforcement actions against prediction markets. Former CFTC and SEC chair Gary Gensler challenged that view, arguing Dodd-Frank was not meant to cover sports event contracts and that sports betting is not the kind of hedging risk the swaps law was designed for.
