Federal court shields Kalshi and Polymarket from Minnesota’s felony crackdown days before deadline
A federal judge temporarily blocked Minnesota from enforcing its new felony prediction-market law against CFTC-designated contract markets such as Kalshi and Polymarket US until a final merits decision. The court found the challengers likely to succeed on express preemption because the Commodity Exchange Act gives the CFTC exclusive jurisdiction over swaps on designated contract markets, and some event contracts may qualify as swaps when tied to financial, economic, or commercial consequences. The ruling appears strongest for certain markets like election, sports, and geopolitical events, but not all event contracts. Minnesota’s law still takes effect Aug. 1 and remains enforceable against others, including possibly customers, advertisers, and service providers. The court did not decide implied preemption or First Amendment claims. Polymarket said it would continue serving Minnesota users; the state said it would keep defending the law.
