Federal Court Blocks Minnesota's Ban on Prediction Markets

A federal court has issued a ruling preventing Minnesota from enforcing its law that would have banned prediction markets, just days before the law was set to take effect on August 1. The law was challenged by the Trump administration and two major prediction markets, Kalshi and Polymarket, after it was enacted in May. The cases were consolidated, leading to a preliminary injunction against the law. Minnesota lawmakers had classified prediction markets as similar to gambling, while the US Commodity Futures Trading Commission (CFTC) contends that it has the exclusive authority to regulate these platforms under federal law. A key legal issue is whether event contracts fall under the definition of "swaps," which are regulated by the CFTC.