Minnesota Accuses Trump of Self-Interest in Court Filing Over Prediction Market Ban

Minnesota state authorities have escalated their fight against prediction markets. In a fresh court filing they accuse President Donald Trump of pushing federal deregulation for personal gain while the state defends its ban on the platforms.

The document targets Kalshi, Polymarket, and the Commodity Futures Trading Commission. All three sued Minnesota after the state banned prediction markets. Minnesota argues the CFTC lacks authority over wagering on sports, politics, cultural or social events. Federal law therefore does not preempt state rules. Operators cannot legally offer these products to Minnesota residents.

The filing directly calls out Trump’s shifting positions. It highlights his April remarks where he said he did not like the emergence of betting on anything. Trump stated “In every place, they’re doing these betting things, I was never much in favor of it. I don’t like it conceptually, but it is what it is.”

The document notes “Despite President Trump seeming to acknowledge that simple truth—that many wagers offered on prediction markets turn the world into a casino—the Trump Administration is nonetheless actively fighting to deregulate the prediction market industry as quickly as it can.”

Trump reversed course quickly. He posted on social media that it is “critically important” the CFTC retains “exclusive authority” over prediction markets. He labeled Minnesota Governor Tim Walz and others “SCUM” for trying to set rules.

Conflict of Interest Claims Target Trump Media Plans

The filing points to web-based companies planning to add prediction market betting. It specifically names Trump Media and Technology Group’s social media company, Truth Social.

The implication is clear. Trump pushes deregulation while his business interests stand to benefit. Trump Media partnered with Crypto.com. It announced plans last year to launch its own prediction market platform, Truth Predict.

That venture has not launched. Reports last month indicated Trump Media scaled back plans for a standalone platform. It will instead expand the Crypto.com partnership through OG.com.

Trump’s son, Donald Trump Jr., adds another layer. He invested in Polymarket through his venture capital firm. He also serves as a strategic advisor to both Kalshi and Polymarket.

A New York Times piece last month detailed how the CFTC quashed attempts to regulate prediction markets under the Trump administration. This included removing employees who raised questions about licensed operators.

From the supplier side this kind of overlap raises immediate operational questions. When a sitting president’s family holds direct stakes in the very platforms fighting state bans, compliance teams cannot treat the regulatory map as neutral.

Kentucky Joins the State-Level Pushback

Each week brings fresh lawsuits in the battle over prediction market legality. Last week Kentucky became the latest state to sue. It filed against Kalshi and Polymarket claiming they are “operating illegal sportsbooks and breaking our laws.”

Separately CME, the prediction market platform partnered with FanDuel, sued the CFTC. The suit claims the agency failed to block perpetual futures markets.

The CFTC approved Kalshi’s bitcoin perpetual futures, or “perps,” markets last month. These are futures contracts with no expiration date that allow traders to speculate on price without owning the underlying asset.

CME CEO Terrence Duffy pushed back hard. The markets should be considered swaps under the Commodity Exchange Act and should go through CME as it has an “exclusive license with every single provider of the benchmarks.”

Duffy added that he was ready for the fight. He stated “I’ve never shied away from one, and I won’t shy away from this. I’m prepared, and I will be prepared to go through this.”

After eighteen years across iGaming and sportsbook operations the pattern feels familiar. States assert control over wagering. Federal agencies and licensed operators push back with preemption arguments. The volume of litigation keeps climbing.

Risks and Limitations in the Current Legal Storm

The accelerating court cases carry real risks for operators and for market clarity. Minnesota’s conflict-of-interest framing against Trump could sway judicial views on administrative impartiality. Yet proving personal gain as the dominant motive remains difficult when public policy statements also cite farmer impacts and CFTC expertise.

Kentucky’s illegal sportsbook label tests how prediction contracts map to existing gambling statutes. If courts accept that framing it could trigger enforcement actions beyond civil suits. CME’s perpetual futures dispute sits on narrower technical ground yet still ties up regulatory bandwidth.

The limitation is obvious. No single filing resolves the core question of whether event contracts are commodities under federal oversight or wagering under state control. Each new lawsuit adds cost and uncertainty without delivering precedent that sticks nationwide.

From an operational standpoint this fragmentation forces platforms to maintain separate compliance stacks per jurisdiction. That is expensive. It also slows product rollout at exactly the moment liquidity and user growth matter most.

The Bottom Line

Minnesota’s filing sharpens the battle lines by naming Trump’s business ties and his policy reversal. Combined with Kentucky’s suit and CME’s action it shows how quickly the legal front is expanding. Prediction market operators now face coordinated state resistance alongside federal turf disputes.

The next few rulings will matter. They could either reinforce CFTC authority or hand states stronger tools to enforce bans. In the meantime platforms must price in higher legal overhead and slower geographic expansion.

Watch the Minnesota case closely. Its conflict-of-interest angle may not win the day but it changes the tone of the debate. For those building in this space the real work is preparing for a regulatory map that stays messy longer than anyone hoped. If you are navigating these issues our advisory team can help map the practical next steps.