The CFTC orders Kalshi to honor trades on Michigan’s exchanges, escalating a heated dispute over state government regulatory authority

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Golden Finance reported that on July 15, the U.S. Commodity Futures Trading Commission (CFTC) ordered Kalshi, a prediction market platform, on Tuesday to carry out all trading contracts involving residents of Michigan, directly challenging a court ruling that the state had previously sought to overturn related transactions.
About two weeks ago, a Michigan court ordered Kalshi to stop offering sports-event-related prediction contracts and required the cancellation/voiding of some already executed trades. However, the CFTC made clear that state governments have no authority to interfere with market trading within the scope of federal regulation.
In a statement, CFTC Chair Michael Selig took a hardline stance: “A state government cannot compel a contract market to violate federal obligations, and federal law also does not allow discrimination against residents of any state. Canceling/voiding executed trades is an unprecedented and dangerous move that will trigger a chain reaction in the market, undermining the core cornerstone of contract certainty that supports how the market operates.”
At present, the CFTC is engaged in a direct confrontation with multiple states over jurisdiction over prediction markets. It has already filed lawsuits against Connecticut, Illinois, and New York, seeking to clarify the regulatory supremacy that Congress has granted to federal agencies. This power struggle between the federal government and the states may ultimately be decided by the U.S. Supreme Court.
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