CFTC sues New Mexico officials over sports betting market jurisdiction

This legal action follows New Mexico's recent lawsuit against Kalshi, a prediction market platform, for allegedly operating without a license and allowing participation by individuals under the legal age of 21. Attorney General Torrez stated that lawful gaming in New Mexico operates under tribal-state compacts or strict state regulations.

The CFTC, under Chair Michael Selig, has been actively asserting its jurisdiction over prediction markets, viewing them as federally regulated derivatives. The agency argues that the Commodity Exchange Act grants it exclusive jurisdiction over such transactions. This is not the first time the CFTC has taken legal action against states, having previously sued Wisconsin, Illinois, Arizona, Connecticut, and New York over similar jurisdictional disputes.

Selig emphasized that New Mexico's actions attempt to nullify federal law and judicial precedent by imposing state gaming laws on federally regulated derivatives exchanges. The CFTC contends that the enforcement efforts by New Mexico harm the United States and the Commission by infringing upon the federal government's statutorily protected interest in maintaining exclusive jurisdiction.