The company argues in its lawsuit that the Minnesota law violates the Commodity Futures Trading Commission’s (CFTC) exclusive jurisdiction over designated contract markets (DCMs) and violates the First Amendment’s protection of advertising, according to the report.
The office of Minnesota Attorney General Keith Ellison told local news station KSTP that the office is reviewing the lawsuit and will respond in court.
“I’m very concerned about the harms of prediction markets on Minnesotans,” Ellison said in a statement, KSTP reported. “Prediction markets are designed to be addictive and prey especially on young people and low-income folks.”
PYMNTS reported May 21 that when Minnesota Gov. Tim Walz signed the bill, Minnesota became the first state in the nation to enact a law banning prediction market platforms from operating within its borders.
Minnesota state Rep. Emma Greenman, the Democratic sponsor of the legislation, told Minnesota Public Radio News: “We as a state should decide how best and what regulations we think should attach to gambling, to protect public safety, to protect our kids.”
The CFTC said in a May 19 press release that it sued Minnesota to block the law. The regulator said the state’s law undermines a federal regulatory regime that Congress set up more than 50 years ago.
“Minnesota farmers have relied on critical hedging products on weather and crop-related events for decades to mitigate their risks,” CFTC Chairman Michael S. Selig said in the release. “Governor Walz chose to put special interests first and American farmers and innovators last.”
In another recent move, Kalshi said in a May 22 press release that it is backing a new advocacy organization called Americans for Fair Markets (AFM) that aims to shape federal policy on prediction markets and federally regulated exchanges.
“Millions of Americans have shown they want regulated, open and fair prediction markets — and we’re going to make sure they have access to them,” John Bivona, AFM board member and Kalshi head of government relations, said in the release.
