CFTC sues New York over prediction market crackdown as 38 AGs back Massachusetts' Kalshi case!

The CFTC has filed suit against New York, marking the fourth state the agency has sued in just three weeks in an escalating federal-versus-state battle over prediction market jurisdiction. The action lands three days after New York's own AG sued Coinbase and Gemini, turning the Empire State into a two-front regulatory war zone.

The broader fight is crystallizing fast: 38 state attorneys general have now thrown their weight behind Massachusetts in its separate Kalshi case, a coalition that signals coordinated state-level resistance to federal preemption of prediction market oversight.

The pace — four state lawsuits in 21 days — suggests the CFTC is forcing a definitive legal answer on which regulator controls these markets before the political window narrows. The outcome will set the compliance baseline for every prediction market operating in the US.