The Commodity Futures Trading Commission filed suit against Kentucky on Tuesday, bringing the total number of states facing federal litigation over prediction-market jurisdiction to nine.
The CFTC's complaint seeks declaratory and injunctive relief to block Kentucky from enforcing state gaming statutes against CFTC-registered exchanges. The suit names Kentucky Governor Andrew Beshear, Attorney General Russell Coleman, and the Kentucky Horse Racing and Gaming Corporation.
"Kentucky is the latest state attempting to shut down federally-regulated event contracts," CFTC Chair Michael S. Selig said in the press release. "Prediction markets provide Kentuckians with valuable information about the likelihood of future events and offer risk management products relied on by Kentucky businesses and individuals.”
“As I've consistently pledged, the CFTC is firmly committed to maintaining its exclusive jurisdiction over prediction markets, and today's lawsuit against Kentucky is yet another example of the Commission protecting its federal interests," Selig said.
Kentucky's state-court filing last week named five platforms: Kalshi, Polymarket, and three CFTC-registered futures commission merchants that partner with them: Coinbase, Robinhood, and Webull. The state alleged they were operating without a Kentucky gaming license and that their sports-event contracts fall squarely within Kentucky's definition of sports wagering. Sports betting in Kentucky has been regulated by the Horse Racing and Gaming Corporation since 2023. The state also alleged the platforms provide users few or no resources to identify or seek help for a gambling problem, as required by state law.
