CFTC Seeks Injunction Against Arizona Prediction Markets
Summary
The CFTC filed a motion for preliminary injunction and temporary restraining order in the U.S. District Court for the District of Arizona to halt Arizona's enforcement of state criminal and gambling laws against CFTC-regulated prediction markets. The CFTC argues that its authority over event contracts under the Commodity Exchange Act preempts state regulation. The agency has also filed complaints against Connecticut and Illinois for similar state actions.
What changed
The CFTC filed a motion seeking a preliminary injunction and temporary restraining order against Arizona to stop enforcement of state criminal and gambling laws against prediction market operators. The action builds on a joint DOJ lawsuit challenging Arizona's preempted conduct and asserts that the Commodity Exchange Act grants CFTC exclusive jurisdiction over event contracts, which preempts state law. The CFTC has also filed complaints against Arizona, Connecticut, and Illinois seeking declaratory judgments and permanent injunctions preventing enforcement of preempted state laws.
Prediction market operators and CFTC registrants face significant jurisdictional uncertainty as federal and state authority conflict. Arizona's pursuit of criminal charges against prediction market operators represents a direct challenge to federal regulatory authority. Companies operating or planning to operate prediction markets in these states should monitor litigation developments and ensure compliance with CFTC registration and reporting requirements.
What to do next
- Monitor court proceedings on CFTC's motion
- Assess exposure if operating prediction markets in affected states
- Review Commodity Exchange Act compliance obligations
Archived snapshot
Apr 10, 2026GovPing captured this document from the original source. If the source has since changed or been removed, this is the text as it existed at that time.
Release Number 9208-26
CFTC Seeks to Enjoin Arizona Criminal and Civil Enforcement Against Prediction Markets
April 09, 2026
WASHINGTON — The Commodity Futures Trading Commission filed a motion Wednesday in the U.S. District Court for the District of Arizona asking the court for a preliminary injunction and temporary restraining order that would halt Arizona’s efforts to apply state criminal and gambling laws against CFTC-regulated prediction markets. This motion builds on last week’s filing, with the Department of Justice, of a lawsuit challenging Arizona’s preempted conduct.
“Arizona’s decision to weaponize preempted state criminal law against companies that comply with a comprehensive federal regime sets a dangerous precedent,” said Chairman Michael S. Selig. “The CFTC is committed to vigorously defending its exclusive authority over prediction markets. We are asking the court to send a clear message that intimidation is not an acceptable tactic to circumvent federal law.”
The CFTC has filed complaints against Arizona, Connecticut, and Illinois, seeking declaratory judgments that federal law grants the CFTC exclusive authority to regulate event contracts and requesting permanent injunctions preventing the states from enforcing preempted state laws against its registrants. In addition to Arizona pursuing criminal charges, each of the three states had sent cease and desist letters to CFTC-regulated entities. The CFTC has clear and longstanding exclusive jurisdiction to regulate event contracts under the Commodity Exchange Act, which preempts state laws purporting to regulate prediction markets.
-CFTC-
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