Trump administration proposes new prediction market regulations
The Trump administration on Wednesday proposed new federal regulations for prediction markets and event contracts. The rules would largely leave the existing market structure intact and still permit most sports-related activity, though specific regulatory contents and oversight agencies were not detailed in available reports. The proposal faces opposition from a bipartisan majority of states and members of the public who view prediction markets as 'backdoor sportsbooks.' The final version is expected to face court challenges. The article was reported by Marshall Cohen of CNN and syndicated by multiple outlets.
Platforms like Kalshi and Polymarket now face parallel fights on two fronts: defending against state bans like Minnesota's felony statute while shaping this federal rulemaking. If the final rule preempts state authority, it neutralizes the 'backdoor sportsbook' attack; if it defers to states, the patchwork deepens.
The proposal arrives the same week the CFTC sued Minnesota and Gov. Walz to block the nation's first state prediction market ban, showing the administration is simultaneously writing federal rules while fighting to preempt state-level crackdowns.