Seventeen Democratic senators sent a letter to the Senate Appropriations Subcommittee on Thursday urging lawmakers to cut off CFTC funding for its campaign of lawsuits against states that have tried to regulate prediction-market platforms under local gambling laws.
Sens. Richard Blumenthal and Jeff Merkley led the effort, joined by 15 colleagues in a letter dated June 24 addressed to Subcommittee Chair Bill Hagerty and Ranking Member Jack Reed. The senators proposed an FY2027 appropriations rider that would prohibit the CFTC from using any funds under the bill "for the purposes of intervening, including through litigation, in state and tribal gambling laws and their enforcement with respect to event contracts."
The letter arrived days after the CFTC sued Kentucky on Monday, making it the ninth state to face federal litigation over the prediction-market jurisdiction question. The CFTC's multi-state campaign began in April with suits against Arizona, Connecticut, and Illinois, followed by Wisconsin in late April and New Mexico earlier this month.
The CFTC's legal theory across all nine suits holds that event contracts offered by federally registered platforms like Kalshi and Polymarket are swaps under the Commodity Exchange Act, giving the agency exclusive federal jurisdiction and preempting state gaming laws. States have pushed back, arguing their gambling statutes apply to the platforms regardless of federal registration.
