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BTC $66,485.49 -1.44%
ETH $1,947.18 -1.79%
BNB $605.08 -1.74%
XRP $1.42 -4.56%
SOL $81.67 -4.53%
TRX $0.2795 -0.47%
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BCH $545.79 -2.59%
LINK $8.64 -2.97%
HYPE $28.98 -1.81%
AAVE $122.61 -3.42%
SUI $0.9138 -6.63%
XLM $0.1605 -4.62%
ZEC $260.31 -8.86%

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Opinion: The recent lawsuit outcome of Polymarket will determine the regulatory jurisdiction of prediction markets in the United States

Recent federal litigation by Polymarket against Massachusetts may determine whether the regulation of prediction markets in the United States falls under federal or state jurisdiction. Polymarket argues in the lawsuit that Congress has granted exclusive regulatory authority over "event contracts" (prediction markets for sports, politics, etc.) to the Commodity Futures Trading Commission (CFTC), and therefore state governments do not have the power to independently prohibit or regulate these platforms.The lawsuit aims to prevent Massachusetts Attorney General Andrea Campbell from potential enforcement actions, following a preliminary injunction issued by the state court against Polymarket's competitor Kalshi, which determined that its sports-related contracts constituted unlicensed sports betting. The regulatory conflict between the federal government and the states is intensifying, with prediction market platforms claiming they are regulated as derivatives markets by the CFTC and can operate nationwide, while states like Massachusetts and Nevada view them as a "sports betting loophole" that circumvents state gambling laws, leading to multiple lawsuits and injunctions.The outcome of Polymarket's appeal could reshape the regulatory framework for prediction markets in the United States, determining whether these platforms can operate free from state gambling law restrictions or must comply with varying rules across states, and it may ultimately be appealed to the U.S. Supreme Court.
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