CFTC Files Tenth Lawsuit Against State Restriction Efforts Targeting Kalshi

The Commodity Futures Trading Commission (CFTC) has sued the state of Utah in federal court over the state's attempt to restrict prediction market platform Kalshi. The filing marks the agency's 10th lawsuit against a state seeking to rein in such platforms and its first against one led by a Republican governor.

The complaint was filed in the US District Court for the District of Utah, Central Division. It names the state and Attorney General Derek Brown as defendants. The CFTC alleges Utah is intruding on its exclusive federal jurisdiction, as Kalshi operates as a federally regulated financial exchange that cannot be regulated under state law.

Utah's State Court Action Against Kalshi

The federal suit follows Utah's own lawsuit against Kalshi filed the prior week. The state alleges the company runs an illegal gambling business and describes the platform as a “public nuisance that is causing substantial ongoing harm” to residents. Utah claims Kalshi violates state gambling laws on betting related to sports, elections, and politics.

Kalshi rejects the allegations. Company spokesperson Jacki McGavick said in a statement that Kalshi, as a federally regulated financial exchange, “answers to federal law, and no single state should have a veto over it.” “Utah seeks to shut down prediction markets across a wide variety of markets,” said CFTC Chair Michael Selig in a statement. “Congress entrusted the CFTC to be the federal regulator with sole responsibility to oversee these markets. As I’ve said before, the CFTC has the expertise and responsibility to defend its exclusive jurisdiction over commodity derivatives, and that’s exactly what we’ll do.”

The CFTC previously sued Arizona, Connecticut, Illinois, New York, Wisconsin, Minnesota, Rhode Island, New Mexico, and Kentucky on the same grounds. Utah Gov. Spencer Cox had earlier dismissed CFTC oversight of the platforms as “a joke.” The dispute could reach the US Supreme Court, which is considering a request from New Jersey officials to take up the issue. As reported by Yogonet International, the CFTC under the Trump administration has pursued its claims through both litigation and rulemaking.

Where the Jurisdictional Clash Heads Next

State officials maintain these platforms constitute gambling subject to local authority and tax rules. The pattern of repeated federal suits signals the CFTC's intent to litigate until exclusive oversight is settled, leaving prediction market operators exposed to conflicting enforcement actions in the interim.