Ceasefires may be on the political agenda this week in Washington but, as our latest Letter From America reports, there’s no sign of peace breaking out across the wider U.S. gambling industry.
Instead, tensions are rising as the Commodity Futures Trading Commission (CFTC) has upped its game, going on the warpath and suing several states.
And in other big news, in Wisconsin Governor Tony Evers has finally put pen to paper and legalised online sports betting – the first state to do so this year.
CFTC Goes To War
America’s most talked about financial regulator–the Commodity Futures Trading Commission (CFTC)–scored perhaps the most consequential gambling story of the month by filing lawsuits against Arizona, Connecticut and Illinois for attempting to “outlaw, regulate or otherwise restrain” the activities of prediction markets.
This marks a rare move by the CFTC to take legal action against states, escalating a fast-growing turf war over control of the U.S. sports betting market between federal regulators and state lawmakers.
“The CFTC will continue to safeguard its exclusive regulatory authority over these markets and defend market participants against overzealous state regulators,” asserted CFTC Chair Michael S. Selig.
“This is not the first time states have tried to impose inconsistent and contrary obligations on market participants, but Congress specifically rejected such a fragmented patchwork of state regulations because it resulted in poorer consumer protection and increased risk of fraud and manipulation,” said Selig.
Wisconsin Wheels Out The Cheese
Meanwhile in Wisconsin, Governor Evers (D) has signed into law AB 601, legalising online sports betting statewide – under Native American tribal oversight.
The bill makes way for a hub-and-spoke model, featuring servers on tribal land, with betting available statewide. But it hinges on new tribal-state compacts that still need to be negotiated.
Wisconsin is the only state this year to pass sports betting expansion laws and the first since Missouri in 2024.
Kalshi Wins New Jersey
In another win for prediction markets, Kalshi has scored a major courtroom victory, with a federal appeals court in New Jersey ruling that state regulators cannot block or control its sports event trading.
In a 2:1 decision, the U.S. Court of Appeals sided with Kalshi, backing federal oversight by the CFTC and classifying contracts as financial swaps.
The ruling is a significant blow for New Jersey and a major boost for Kalshi, which is fighting similar cases in multiple states.
New Jersey officials are said to be weighing their next move, including a possible rehearing by the full Third Circuit Court, though such requests are rarely granted.
NBA Signs PrizePicks
The National Basketball Association (NBA) has struck a multi-year deal with PrizePicks, naming the operator its official Daily Fantasy Sports partner.
Under the terms, PrizePicks will integrate NBA intellectual property across its daily fantasy and free-to-play products and marketing initiatives.
This includes the use of NBA League, collective NBA Team and NBA Event marks across approved digital platforms.
“PrizePicks has established itself as a leader in daily fantasy sports through innovation and a strong focus on the fans,” affirmed Eric Rimsky, Head of Domestic Fantasy at the NBA.
“We’re excited to collaborate with PrizePicks to enhance the NBA fan experience, creating new and engaging ways for fans to connect with the game.”
Cease And Desist!
The Michigan Gaming Control Board (MGCB) has been making bold moves to protect its gaming market from illegal actors.
This week, the regulator issued 45 cease-and-desist letters to illicit operators, in what the Board’s head honcho, Executive Director, Henry Williams, has called a clear message to stay out of the Wolverine State.
The full list of offending domains/operators can be viewed here.
Kentucky Reforms
In a move set to tighten control over the state’s betting market, Kentucky lawmakers have pushed through a slew of last-minute gambling reforms, passing House Bill 904,
Reforms include raising the age of sports betting from 18- to 21-years-old, blocking state-licensed betting operators from participating in prediction markets, and restricting prop bets on college games.
In a surprising twist, Kentucky–unlike the majority of other states–isn’t trying to ban prediction markets outright. Instead, under a separate budget bill (HB 757), federally-regulated operators like Kalshi and Polymarket could be hit with a 14.25 percent tax on transactions.
If signed into law, it would mark the first time a U.S. state has opted to tax prediction markets rather than try to shut them down.
Both bills now await the signature of Governor Andy Beshear (D).
Nohio
Republican lawmakers in Ohio–one of the U.S.’s biggest sports betting markets–have proposed new legislation seeking to prevent online sports betting, which became legal in 2021, with the market launching, somewhat belatedly, at the start of 2023.
The explosive proposal also wants to limit land-based betting to a maximum stake of under US$100 (£74) per day – and limit punters to eight wagers a day, while outlawing free bets and credit card use.
With a staggering 98 percent of Ohio’s US$10+ billion (£7.4bn) handle placed online, critics warn the move could cripple the industry if passed.
Watch this space!
