Office of the
Illinois Attorney General
Kwame Raoul

Chicago — Attorney General Kwame Raoul, as part of a bipartisan coalition of 41 attorneys general, urged federal regulators to reaffirm that jurisdiction over sports-related “event contracts” belongs to states. The attorneys general filed a comment letter with the Commodity Futures Trading Commission (CFTC), arguing that prediction markets, platforms where users trade contracts on the outcome of future events, effectively allow unregulated sports betting.

“On so-called prediction markets, users can place the exact same wagers that can be made through sports betting, which some markets even refer to as bets, yet these markets face no regulation,” Raoul said. “States have long held the power to regulate sports gambling and protect their residents from potential harms. I’m calling on the CFTC to recognize states’ authority when it comes to sports betting on prediction markets.”

The platforms, including Polymarket and Kalshi, allow users to place wagers on game winners, point spreads and player statistics, bypassing the consumer protections and tax requirements mandated by state gambling laws. The coalition argues that because the contracts are considered entertainment-based gambling rather than tools for financial risk management, they fall outside the CFTC’s jurisdiction. The letter notes that gambling regulation falls to the states under well-established case law.

The attorneys general caution that sports gambling poses serious risks to public health and financial security, with millions of Americans qualifying as problematic or pathological gamblers. The coalition asserts that states, not the CFTC, are best equipped to protect their residents from the associated harms.

The coalition’s letter responds to a request from the CFTC for public comment on proposed rules for prediction markets. The states urge the commission to confirm through rulemaking that it lacks jurisdiction over sports-related contracts, ensuring that the power to regulate or prohibit sports gambling remains with states.

Joining Raoul in submitting the comments are the attorneys general of Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, Vermont, Virginia and Wisconsin.