Kalshi, Polymarket win pause against Minnesota's prediction market ban

A federal judge ruled that Minnesota's law criminalizing prediction markets would probably violate the federal Commodity Exchange Act.

Kalshi, Polymarket win pause against Minnesota's prediction market ban

Policy

Kalshi, Polymarket win pause against Minnesota's prediction market ban

A federal judge ruled that Minnesota's law criminalizing prediction markets would probably violate the federal Commodity Exchange Act.

By

Nikhilesh De

|

Edited by

Jesse Hamilton

Jul 27, 2026, 11:29 p.m.

2

min read

Make

preferred on

Share

Share this article

Copy link

X icon

X (Twitter)

LinkedIn

Facebook

Email

Make

preferred on

CFTC Chair Mike Selig (CoinDesk)

A federal judge ruled that Minnesota’s law banning prediction markets likely runs afoul of the Commodity Exchange Act, granting a preliminary injunction against the law to Kalshi, Polymarket and the Commodity Futures Trading Commission.

Judge Katherine Menendez, of the U.S. District Court for the District of Minnesota, ruled Monday that Minnesota’s recently passed law that would ban prediction market operators from offering their products in the state seems to be preempted by the federal CEA, and that the companies and federal regulator “are likely to succeed” in showing so after a full trial.

Kalshi, Polymarket and the CFTC

sued Minnesota earlier this year

after the state passed the law criminalizing the operation of prediction markets, arguing that the statute violated the CFTC’s jurisdiction to oversee “swaps,” which prediction market contracts are structured as.

In her ruling, Judge Menendez said that the three parties had shown they were likely to succeed in their arguments that the law underpinning U.S. commodities exchanges preempts the state law, that the CFTC has jurisdiction over these products and that the plaintiffs would likely succeed on the merits of the case.

“The Court finds that Plaintiffs have met their burden to show they are likely to succeed on the merits of their express-preemption claims, at least as to the application of Minnesota’s law to many of the trades listed on Kalshi’s and Polymarket US’s platforms,” the ruling said. “Specifically, it appears that whether the Minnesota statute is expressly preempted turns on whether the state law attempts to regulate trades in event contracts that qualify as ‘swaps’ within the meaning of the CEA.”

Some of the contracts on prediction markets might fit within the Minnesota law, the judge said, pointing to predictions about who might win the TV program “Love Island” as an example, but it would be difficult to target a preliminary injunction just to those issues.

Not granting a halt of the law would also cause “irreparable harm” to Kalshi and Polymarket, the ruling added.

The preliminary injunction will last until “a final decision on the merits is reached,” the judge said.

Prediction Markets

Latest Crypto News

1

U.S. Senate puts off crypto Clarity Act for now as it focuses limited bandwidth elsewhere

1 hour ago

2

Bitcoin shrugs off AI selloff but high-stakes Fed meeting could determine what's next

5 hours ago

3

Crypto’s favorite $90 trillion trading product is coming to Wall Street, but big banks are taking it slow

7 hours ago

4

Digital asset trading platform Uphold cuts 17% of global headcount as crypto winter bites

8 hours ago

5

What are perps, anyway? Everything you need to know about crypto’s hottest trading instrument

10 hours ago

6

Fanatics buys regulated exchange in bid to grow prediction markets business

10 hours ago

7

Cantor is advising crypto bank AMINA on path to potential public listing

10 hours ago

8

Lido begins moving $16.5 billion in staked ether to cut validator count by a third

11 hours ago

9

Thailand's SEC alleges Bitkub concealed cyberattack that led to $50 million hack

11 hours ago

10

Nvidia forms 37-member AI security alliance without OpenAI, Anthropic or Google

11 hours ago

Latest Research

Crypto Flows, Share and the Selective Rotation

Crypto Flows, Share and the Selective Rotation

Markets repositioned since June, but Binance held share (~55% user funds, ~24% spot) and drew net inflows in early July while the tracked market saw outflows.

By

CoinDesk Research

Jul 22, 2026

Markets repositioned since June, but Binance held share (~55% user funds, ~24% spot) and drew net inflows in early July while the tracked market saw outflows.

Why it matters

:

Markets repositioned since June, but Binance held share (~55% user funds, ~24% spot) and drew net inflows in early July while the tracked market saw outflows.

View Full Report

More From

Policy

U.S. Senate puts off crypto Clarity Act for now as it focuses limited bandwidth elsewhere

Thailand's SEC alleges Bitkub concealed cyberattack that led to $50 million hack

2 weeks left for Clarity: State of Crypto

Crypto

CD20

$1,715.27

CD20 down 3.32 percent

3.32%

BTC

$63,112.28

BTC down 3.17 percent

3.17%

ETH

$1,870.22

ETH down 3.95 percent

3.95%

XRP

$1.06

XRP down 4.64 percent

4.64%

SOL

$73.00

SOL down 4.54 percent

4.54%