On Tuesday, the Commodity Futures Trading Commission (CFTC) filed a lawsuit against Minnesota, aiming to prevent a new state law from taking effect. This law would classify running a prediction market as a serious crime.
Governor Tim Walz has approved a new law that the Commodity Futures Trading Commission (CFTC) calls the strongest state-level attempt to disrupt trading in its markets. The law also makes it illegal for farmers to use contracts tied to weather events.
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Governor Walz and the state of Minnesota are prioritizing special interests over the needs of American farmers and innovators. A new Minnesota law criminalizes the trading of event contracts, which will negatively impact local farmers who depend on these contracts linked to weather and crop conditions.
— Mike Selig (@ChairmanSelig) May 19, 2026
Minnesota’s Law Reaches Further Than Earlier State Actions
The agency is asking the court for a temporary order to prevent a new law from going into effect. This law, Minnesota’s Senate File 4760, is a public safety bill that was signed on May 18, 2026.
Starting August 1, 2026, a new law in Minnesota will make it a felony to run prediction markets – essentially, platforms where people bet on the outcomes of events. This law is very broad, prohibiting wagering on a wide range of things, including sports, elections, the weather, natural disasters, court cases, and even pop culture.
It’s also illegal to create, run, help with, collect information for, or handle payments for these markets, as well as to advertise them.
Minnesota is a major agricultural state, and a new law there is focusing on contracts related to weather events. The CFTC highlighted this law as having the widest scope of any state to date in this area.
A new Minnesota law unexpectedly criminalizes people who legally participate in prediction markets. For years, Minnesota farmers have used hedging tools to protect themselves from risks related to weather and crops. According to CFTC Chairman Michael S. Selig, Governor Walz prioritized special interests over the needs of farmers and innovators.
This case in Minnesota is similar to recent legal challenges in Arizona, Connecticut, Illinois, and New York. Just recently, a court in Arizona temporarily stopped the state from using its gambling laws to go after companies running prediction markets.
The decision could determine if states can still prosecute crimes related to agreements governed by federal law.
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2026-05-20 08:06