Court Blocks Arizona Criminal Charges Against CFTC-Regulated Prediction Markets
Summary
The CFTC obtained a temporary restraining order from the U.S. District Court for the District of Arizona blocking Arizona from pursuing criminal charges against CFTC-regulated designated contract markets. The court action follows the CFTC's complaint seeking declaratory judgment that federal law grants the CFTC exclusive authority to regulate event contracts. Arizona's attempt to apply state criminal law to federally regulated prediction markets was deemed preempted by federal law.
What changed
The U.S. District Court for the District of Arizona granted a temporary restraining order at the CFTC's request, preventing Arizona from continuing criminal enforcement proceedings against CFTC-regulated designated contract markets. This follows the CFTC's filing of complaints against Arizona, Connecticut, and Illinois seeking declaratory judgments that federal law grants the CFTC exclusive authority over event contracts and requesting permanent injunctions against state enforcement actions.
CFTC-regulated prediction market operators should note the CFTC's aggressive stance against state attempts to regulate federally authorized derivatives activities. The court order preserves the status quo pending resolution of the federal preemption dispute. Companies operating in prediction markets should ensure compliance with CFTC regulations and monitor developments in the Arizona, Connecticut, and Illinois cases as they may establish precedent for federal versus state regulatory authority over event contracts.
What to do next
- CFTC-regulated designated contract markets should continue to operate under federal CFTC oversight
- Monitor for additional CFTC actions against Connecticut and Illinois regarding similar state preemption matters
- Review federal preemption arguments in CFTC v. Arizona litigation
Archived snapshot
Apr 11, 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 9211-26
Temporary Restraining Order Blocks Arizona Criminal Enforcement Proceedings on Prediction Markets
April 10, 2026
WASHINGTON — At the request of the Commodity Futures Trading Commission, the United States District Court for the District of Arizona granted a temporary restraining order this afternoon barring Arizona from continuing to pursue criminal charges against CFTC-regulated designated contract markets. This follows last week’s filing of a complaint against Arizona by the CFTC seeking an injunction barring Arizona from attempting to preempt federal law.
“The CFTC appreciates the court’s careful consideration of these important legal questions and the court’s decision to preserve the status quo,” said CFTC Chairman Michael S. Selig. “Arizona’s decision to weaponize state criminal law against companies that comply with federal law sets a dangerous precedent, and the court’s order today sends a clear message that intimidation is not an acceptable tactic to circumvent federal law.”
Last week, the CFTC 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 DCMs. Two days ago, the CFTC also filed a motion for a Temporary Restraining Order and Preliminary Injunction to prevent Arizona from enforcing preempted state laws against CFTC-regulated DCMs.
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