Federal Preemption

The Commodity Futures Trading Commission has filed a federal lawsuit challenging Utah’s attempt to restrict Kalshi’s event-contract offerings. The case escalates a growing clash over whether prediction markets fall under federal derivatives oversight or state gambling bans.

A bipartisan group of state attorneys general is pressing the U.S. Senate to revise the Digital Asset Market Clarity Act before advancing it. The officials warn that ambiguous federal preemption language could limit state lawsuits tied to crypto scams, securities violations and commodities enforcement.