Svmuu reported that the U.S. CFTC has filed a lawsuit in the U.S. District Court for the District of New Mexico against state officials, including Governor Michelle Lujan Grisham and Attorney General Raúl Torrez, seeking to block the state from applying its gambling regulations to prediction market platforms.
Earlier, New Mexico had sued Kalshi, accusing it of offering unauthorized sports betting to state residents and allowing users under the state's legal gambling age of 21 to participate. The New Mexico Attorney General stated that legal gambling in the state can only be conducted under tribal-state gaming compacts or a strict state regulatory framework.
The CFTC argues that platforms like Kalshi offer federally regulated derivatives contracts, not gambling products under state law. CFTC Chairman Michael Selig stated that New Mexico is attempting to impose state gambling laws on a federal derivatives exchange that falls under the exclusive jurisdiction of the CFTC. Over the past few months, the CFTC has sued multiple states, including Wisconsin, Illinois, Arizona, Connecticut, and New York, to assert its regulatory authority over sports prediction markets. This week, the agency also proposed broader rules for prediction markets, which generally still allow sports-related contracts to exist.