U.S. Judge Blocks Minnesota Prediction Market Ban in Kalshi, Polymarket Case

U.S. District Judge Katherine Menendez in Minnesota ruled on Monday that the state’s recent ban on prediction markets may conflict with the Commodity Exchange Act and granted a preliminary injunction to Kalshi, Polymarket, and the U.S. Commodity Futures Trading Commission (CFTC). According to Odaily, Kalshi, Polymarket, and the CFTC sued Minnesota earlier this year after the state passed a law making it a criminal offense for prediction market operators to offer related products in the state.

The three parties argued that prediction market contracts are structured as swaps and that the state law intrudes on the CFTC’s authority over such products. In her ruling, Menendez said the parties may be able to show after a full hearing that federal Commodity Exchange Act preempts the state law.