The Trump administration yesterday sued Minnesota in an attempt to block the first state law that prohibits prediction markets.
While other states imposed restrictions on prediction markets, Minnesota banned them outright in a law signed by Gov. Tim Walz on Monday. The US Commodity Futures Trading Commission announced a lawsuit against the state, saying that Minnesota’s “new legislation represents the most aggressive move by a state to shut down CFTC-regulated markets and undermine the federal regulatory regime set up by Congress more than 50 years ago.”
“This Minnesota law turns lawful operators and participants in prediction markets into felons overnight,” CFTC Chairman Michael Selig said. “Minnesota farmers have relied on critical hedging products on weather and crop-related events for decades to mitigate their risks. Governor Walz chose to put special interests first and American farmers and innovators last.”
The Minnesota law makes it a felony to create, operate, or advertise a prediction market. The CFTC asked the court for preliminary and permanent injunctions to prohibit Minnesota from enforcing the law, which is scheduled to take effect on August 1. The case was filed in US District Court for the District of Minnesota.
