Attorney General Asserts State Authority Over Sports Prediction Markets

Maryland Attorney General Anthony G. Brown has joined a broad bipartisan coalition of 41 state attorneys general in formally urging the Commodity Futures Trading Commission (CFTC) to recognize that regulatory authority over sports-related “event contracts” rests with the states. The group submitted comments to the federal agency, contending that prediction markets, which allow users to trade contracts based on the outcomes of future events, are functioning as unregulated sportsbooks.

The attorneys general argue that the distinction between wagers placed on sportsbooks and those on prediction markets is negligible, as users can make similar bets on both types of platforms. These prediction markets, such as Polymarket and Kalshi, facilitate wagers on game results, point spreads, and individual player statistics. By operating outside of state regulatory frameworks, these platforms bypass consumer protections and tax obligations that are typically mandated by state gambling laws. The coalition contends that because these contracts are primarily used for entertainment-based gambling rather than for financial risk management, they fall outside the CFTC’s purview. Existing legal precedent firmly establishes gambling regulation as a power reserved for the states.

The coalition’s letter highlights the significant risks associated with sports gambling, including potential harms to public health and financial security, noting that millions of Americans are considered problematic or pathological gamblers. They assert that states are uniquely positioned to safeguard their residents from these dangers, possessing the necessary expertise, experience, and tools to regulate sports betting, a responsibility they have held for over a century. The comments were submitted in response to a CFTC request for public input on proposed rules for prediction markets. The states are calling on the commission to officially confirm through rulemaking that it lacks jurisdiction over these sports-related contracts, thereby preserving the states’ authority to regulate or prohibit sports gambling.

This initiative builds upon earlier efforts, with Attorney General Brown having led a coalition of states in establishing a common interest group focused on prediction markets in April 2025. This group, which began with three states, has since grown to include approximately 16 states and over 60 attorneys, facilitating coordinated responses to litigation, including the submission of several amicus briefs. In a related development aimed at preventing the misuse of nonpublic government information, Maryland Governor Moore issued an executive order on April 24, 2026, prohibiting state employees from gambling on prediction markets to uphold public trust in state government.

The coalition includes the attorneys general from Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, 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.

Article by Mel Anara, based upon information from the Maryland Attorney General.

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