Federal Court Blocks Minnesota Enforcement Of Prediction Markets Ban Against CFTC-Registered Contract Markets
A federal court granted preliminary injunctions to Kalshi, Polymarket, and the CFTC, enjoining Minnesota from enforcing SF 3432 against CFTC-registered contract markets. The Black Executive Journal — Daily Edition
Federal preemption locked in. A federal judge on Monday granted preliminary injunctions to Kalshi, Polymarket, and the Commodity Futures Trading Commission, enjoining Minnesota from enforcing SF 3432 against any entity registered as a designated contract market (DCM) — a ruling that reshapes the state-versus-federal fight over prediction-market oversight.
CFTC comment window just closed. The court's ruling landed the same day the CFTC's Advanced Notice of Proposed Rulemaking on prediction-market event contracts closed for public comment, setting the stage for a federal rule that could preempt a growing patchwork of state actions.
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CFTC-registered DCM status is now a shield. The Minnesota ruling elevates DCM registration from a compliance checkbox into a defensive moat — one that reshapes market structure for prediction markets, event contracts, and any operator building on federally regulated derivatives infrastructure.
Federal Court Blocks Minnesota Enforcement Of Prediction Markets Ban Against CFTC-Registered Contract Markets
Federal Preemption Reshapes Prediction Markets
Judge Kate M. Menendez of the U.S. District Court for the District of Minnesota granted three separate preliminary injunction motions on Monday, July 27, 2026 — one filed by the CFTC (Dkt. 24), one by Kalshi (Dkt. 21), and one by Polymarket (Dkt. 19) — in CASE 0:26-cv-02841-KMM-DTS.
The order enjoins Minnesota Attorney General Keith Ellison, Governor Tim Walz, and Public Safety Commissioner Bob Jacobson from enforcing Minn. Stat. § 609.7615, as amended and adopted by SF 3432, against entities registered as designated contract markets by the CFTC — until a final decision on the merits.
The ruling is narrow in scope but wide in consequence.
It preserves a federal statutory framework — the Commodity Exchange Act — as the operating regime for prediction-market event contracts and prevents states from imposing overlapping criminal or civil liability on federally licensed venues while the underlying preemption question moves through the courts.
