CFTC Sues New York to Preserve Prediction Market Authority
Summary
The CFTC filed a lawsuit in the U.S. District Court for the Southern District of New York on April 24, 2026, seeking a declaratory judgment that federal law grants it exclusive authority over event contracts and a permanent injunction preventing New York from enforcing state gambling laws against CFTC-registered exchanges. The action is the fourth in a series of CFTC lawsuits against states — following Arizona, Connecticut, and Illinois — that have attempted to apply state gambling laws to CFTC-registered prediction market operators. New York has issued cease-and-desist letters and civil enforcement suits against these exchanges.
“The CFTC’s action builds upon ongoing efforts to affirm its exclusive jurisdiction over CFTC-registered designated contract markets that offer trading in event contracts.”
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What changed
The CFTC filed a federal civil action in the Southern District of New York seeking injunctive and declaratory relief. The complaint asserts that federal law grants the CFTC exclusive regulatory jurisdiction over event contracts offered by CFTC-registered designated contract markets and that New York's application of state gambling laws to these markets is preempted. The CFTC seeks a permanent injunction barring New York from enforcing any state laws against CFTC registrants engaged in lawful prediction market activity.\n\nCFTC-registered exchanges offering event contracts in New York may face reduced state enforcement risk pending resolution of this litigation. Prediction market operators that received cease-and-desist letters or civil enforcement actions from New York should monitor this case closely, as a favorable CFTC ruling could invalidate state-level gambling enforcement against registered prediction market platforms. The CFTC's litigation in four states signals a coordinated effort to establish federal preemption in the prediction market regulatory space.
Archived snapshot
Apr 25, 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 9218-26
CFTC Sues New York Over Prediction Markets Amid Ongoing Efforts to Preserve Jurisdiction
April 24, 2026
WASHINGTON — The Commodity Futures Trading Commission today filed a lawsuit in the U.S. District Court for the Southern District of New York to halt the State of New York’s efforts to apply state gambling laws against CFTC-registered contract markets.
New York has sought to enforce state laws against CFTC-registered entities through cease-and-desist letters and civil enforcement suits. In its complaint against New York, the CFTC seeks a declaratory judgment that federal law grants it exclusive authority to regulate event contracts and requests a permanent injunction preventing the state from enforcing preempted state laws against its registrants.
“CFTC-registered exchanges have faced an onslaught of state lawsuits seeking to limit Americans’ access to event contracts and undermine the CFTC’s sole regulatory jurisdiction over prediction markets. New York is the latest state to ignore federal law and decades of precedent by seeking to enforce state gambling laws against CFTC-registered exchanges,” said Chairman Michael S. Selig. “As I’ve said before, the CFTC will not allow overzealous state governments to undermine the agency’s longstanding authority over these markets.”
The CFTC’s action builds upon ongoing efforts to affirm its exclusive jurisdiction over CFTC-registered designated contract markets that offer trading in event contracts. It follows similar CFTC lawsuits in Arizona, Connecticut, and Illinois.
-CFTC-
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