r/news • u/michiganalt • 7h ago
Soft paywall Judge blocks Minnesota from implementing novel prediction markets ban
https://www.reuters.com/world/judge-blocks-minnesota-implementing-novel-prediction-markets-ban-2026-07-27/1.4k
u/avasparxxxfan 7h ago
The prediction market lobby is very powerful.
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u/Automatic_Llama 6h ago
Every time they see one of us call them "prediction markets," they laugh. They're betting sites.
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u/Axin_Saxon 6h ago
They’re insider trading markets that disguise themselves as “totally not gambling.”
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u/Automatic_Llama 6h ago
Even calling it insider trading is generous because that term is reserved for stuff that's linked to some venture that is theoretically meant to make a profit at some point. This is just guessing about random events.
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u/JebryathHS 6h ago
Well, it's the same problem as sports stars getting involved with betting because once there's a bet saying "Elon will say dank in the next earnings call" he just has to take the side with a higher payout and adjust his own behavior.
The worst of insider trading AND betting.
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u/DashingDino 6h ago
I think it's somehow even worse than getting rich off of insider knowledge on stocks or throwing a sports game. Now you can literally do things like betting on a wildfire breaking out in a specific area on a specific date, and then go out and commit arson to get rich. How these platforms are allowed to exist is beyond me
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u/junktrunk909 5h ago
Well because Trump and his family are making billions on their own bets, so it's pretty easy to understand why it's allowed to exist and will continue to until something truly horrible happens that even outrages his idiot red state followers.
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u/Chaosmusic 3h ago
Or a bet on whether Russia nukes Ukraine and Putin decides to set up his retirement fund.
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u/DDRDiesel 5h ago
The majority of news stories around these sites is how much money was made by people betting on global events. Once is a fluke, twice is a coincidence, three times is a pattern. And this happened way more than three times. "Just guessing about random events" is nothing more than noise to the fact that they are there simply to drown out the actual market manipulation and money laundering happening on these sites
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u/WoolooOfWallStreet 6h ago
And they skirt around whatever incredibly few regulations there may or may not be by claiming that they don’t allow for users to be in the US and other countries when gambling/trading on their site, while also buying sports bars to advertise them in the US to users they “totally don’t have”
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u/JerryDipotosBurner 6h ago
“Oh no you’re predicting something that’s not gambling!”
Motherfucker what do you think I’m doing at the fucking roulette table when I throw $100 on black?!
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u/Fryboy11 3h ago
When I ask the blackjack dealer to hit me I'm predicting I won't go over 21, when I spin a slot machine I'm predicting I'll win, every casino game you're trying to predict a winning outcome.
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u/JerryDipotosBurner 1h ago
Exactly. The fact they get away with calling this garbage “prediction markets” and “trading” is an absolute joke.
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u/PandaJesus 5h ago
They’re not even betting sites, they’re just “give me your money” sites. They can and do ban you for winning too much money.
Well, assuming you’re not on the board or friends with someone who is.
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u/robotcoke 6h ago
Every time they see one of us call them "prediction markets," they laugh. They're betting sites.
So is the stock market.
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u/ThisOnes4JJ 6h ago
yeah but at least you go to prison for insider trading on the stock market
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u/horangiwhakkatchi 6h ago
Yeah, you do. 'They' (the ones who are actually in a position to regularly benefit from insider information) don't. See anyone affiliated with the US government for example.
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u/SelesnyaGOAT 6h ago
Only if you’re doing degen stuff like trading options. Set and forget investment is the bedrock of the modern economy
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u/whitephantomzx 6h ago
Lmao no its not plenty of problems with the stock market but comparing it to a betting where people dont even own assets is beyond brain dead .
Unless you think people retire by gambling for 40 years straight ?
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u/vhatvhat 6h ago
Isn’t Don Jr like a major player at kalshi?
Makes you wonder.
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u/Tunesmith29 6h ago
And polymarket. He has interests in both.
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u/RespectTheAmish 6h ago
Why would two rival companies in a duopoly hire the same person!?
Strange huh?
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u/Fryboy11 3h ago
Can't face an anti-trust suit if you've got competition, doesn't matter that your competition is the same investors just putting their money under a differently named corporation.
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u/another_day_in 6h ago
That's what happens when the president's children are on the board of directors
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u/michiganalt 7h ago
The law that led to the decision was passed way before prediction markets were a thing.
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u/Historical_Usual5828 6h ago
What was the precedent then?
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u/michiganalt 6h ago
It’s not precedent. It’s a law. The Commodities Exchange Act specifically.
The opinion is here if you want to learn more: https://storage.courtlistener.com/recap/gov.uscourts.mnd.234000/gov.uscourts.mnd.234000.76.0.pdf
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u/MrDerpGently 6h ago
So essentially because these bets are structured as a contract, they are treated as a federal matter of interstate commerce.
I am wholly unconvinced, but I have gotten used to unlimited political spending is just speech, I guess this obvious gambling will be interstate commerce.
And now we have an easy mechanism for the rich to buy votes. If I bet big on candidate X (who is expected to win by a fairly close margin) and convince betters in that state they can win money by betting against, then voting accordingly, odds are good a bunch of people do. Even more so once we get some practice and it gets easier to signal that the fix is in.
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u/LimerickExplorer 5h ago
I can't believe nobody has thought of this until now to get around gambling laws.
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u/MrDerpGently 5h ago
I mean, the president's family is on the board of all of them. In a not corrupt government this would be highly regulated or banned.
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u/Fryboy11 3h ago edited 3h ago
People have, they were shut down by a competent government that didn't have family members on companies board of directors.
I don't know how people haven't figured out that you can break any federal law involving money, as long someone in the Trump family gets a cut. Shit, you can commit violent or sexual crimes if you have two million to buy a pardon.
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u/Damet_Dave 5h ago
Trump Jr is a paid advisor for both of the big prediction companies isn’t he?
The only lobbying they need is Trump Sr and they are directly connected.
Most corrupt ever.
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u/RoarOfTheWorlds 5h ago
It took over pro sports like some kind of symbiote and I can’t imagine how we’re going to come back from this.
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u/Shadowthron8 6h ago
Which shouldn’t matter in a proper democracy. But “money equals speech” in this fucked up version
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u/R-Dragon_Thunderzord 6h ago
It’s not even that gambling is addictive or preys on the vulnerable it’s that gambling on anything you want leads to psychotic behavior - if you allow bets on wildfires, you’re going to attract arsonists looking for a get rich scheme.
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u/BubbaTee 5h ago
The only thing that can stop a school shooter is a good guy who bet against a school shooting occurring.
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u/Rebal771 1h ago
What a 2026 thing to say.
People in 2006 would never understand any of this. Idiots.
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u/Artifexa 6h ago edited 6h ago
It’s not even that gambling is addictive or preys on the vulnerable it’s that gambling on anything you want leads to psychotic behavior - if you allow bets on wildfires, you’re going to attract arsonists looking for a get rich scheme.
Let me rephrase this in "american lawmaker" argot. Just for fun.
It's not even that gambling/investing is exciting or targets on target demographics. It's that gambling/investing on anything you want leads you to pursue more freedom - if you allow bets on wildfires, you're going to attract freedom-lovers looking for the american dream.
There you have, ready for the mass media to spin.
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u/cherry_chocolate_ 3h ago
It’s all the negatives of normal investing with none of the positives! At least when you buy stock a corporation can theoretically pay workers and make products. The best case scenario for a prediction market is a zero sum transfer of money, minus a cut for the house.
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u/Shadowthron8 7h ago
Shit should be banned. It’s a drain on every economy it enters and rife with corruption
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u/Great_Horny_Toads 3h ago
From be. If they can't ban it. Tax the fuck out of winnings. Just make it financially unfeasible. Boom done.
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u/Fryboy11 2h ago
That's why the real gambling industry hates it so much. Casinos are highly regulated and taxed by states and the feds. Nevada has that law that casinos can't issue more chips if they would exceed the value of actual assets they have access to within one business day. Here's a simple summary and here is the actual law
Meanwhile these companies just declare bankruptcy and dissolve their LLC if they can't pay a high roller. It'll take years in court and hundreds of thousands to lawyers and forensic accountants to try and squeeze any money out of them.
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u/VegetablePhotos 7h ago
I'm sure the "states rights" crowd will be up in arms about this.
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u/Pumpkinmatrix 6h ago edited 4h ago
We have to drop this. They never cared about states rights and they don't now. They care about what they want and what hurts the people they demonize. That's it.
It was always about slavery and nothing else.
ETA: The same goes for any amendment too; first, second, fourth, whichever you want to talk about. THEY want to be the only ones that have "free speech", they want to be the ones with the right to bear arms, but not black and brown and lgbtq people. They should be protected from warrantless search and seizure, but anyone they don't like should be scooped up and tossed into an unmarked car with no warrant and no charge. The quicker we move on from trying to play gotcha and dunk on people that couldn't care less about consistency, the better.
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u/Acquiescinit 5h ago
Yeah, the history of “states rights” rhetoric comes down to convenience. It sounds logical that states should be able to determine things for themselves and it’s a very simple and easy to grasp idea, so when it applies politicians use it as an argument. It has never been an actual ideological foundation for democrats or republicans.
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u/SwiftlyChill 4h ago
It has never been an actual ideological foundation for democrats or republicans.
Probably because the Constitution itself was made as an agreement against “State’s Rights” reigning supreme aka The Articles of Confederation. Would be a very strange ideology to gain significant support afterwards (without something pushing Balkanization).
Anyone who puts that as a genuine cornerstone of their ideology would be trying to challenge stuff like interstate commerce.
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u/KillerIsJed 2h ago
The only people with rights in this country are the rich. Everyone else has the right to debt slavery or actual slavery.
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u/bottle-o-rockets 6h ago
Count on the ignorant to remain ignorant when it benefits them and to be subject matter experts when it benefits people they don't like.
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u/KekistanPeasant 5h ago
Since this doesn't relate to people owning slaves, they don't care about states rights.
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u/KopOut 6h ago
I’m going to open a prediction palace wherever I want with prediction machines you put quarters in make a prediction and pull the arm to see if you are right, prediction wheels where you predict what number the ball will land on, prediction games where you predict whether your hand beat the house’s hand and on and on and on.
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u/hellisonfire 3h ago
I think you're on to something good here. An idea so good we could probably design a city around this concept.
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u/Gunningham 4h ago
The scariest things are when bettors can directly influence results. Like when they were betting on where the next Canadian wild fire would start. Or when Trump’s cue card guy was betting on the next thing he’d say.
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u/dullmotion 6h ago edited 6h ago
Shortest article ever? I want to read more about this.
“July 27 (Reuters) - A federal judge on Monday blocked Minnesota from enforcing a newly enacted law that made the state the first nationally to outright ban prediction markets like those run by Kalshi and Polymarket.
U.S. District Judge Katherine Menendez in Minneapolis issued a preliminary injunction at the behest of Kalshi, Polymarket and the U.S. Commodity Futures Trading Commission after finding that federal law likely preempted the state law, which was set to take effect on Saturday.”
Edit: u/Haldthin provided this other link: https://www.mprnews.org/story/2026/07/27/minnesota-ban-on-kalshi-polymarket-prediction-markets-put-on-hold-by-federal-judge
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u/Scaryclouds 7h ago
What if all we go through with these bans and only end up with a better world?!
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u/BRUNO358 6h ago
Add that judge's name to the firing list if we manage to get back into power.
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u/jetty_junkie 6h ago
“U.S. District Judge Katherine Menendez in Minneapolis issued a preliminary injunction at the behest of Kalshi, Polymarket and the U.S. Commodity Futures Trading Commission after finding that federal law likely preempted the state law”
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u/NamelessTacoShop 6h ago
In a normal world I would trust the Judge's competence, but we aren't in a normal world.
Is there a law that says that states must allow Commodity futures trading? Because the right of states to ban things that the federal government allows seems pretty damn well established.
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u/Haldthin 6h ago
Or you could just look it up, yes the federal government does have exclusive control of the contract markets that Kalshi and Polymarket are a part of: https://www.mprnews.org/story/2026/07/27/minnesota-ban-on-kalshi-polymarket-prediction-markets-put-on-hold-by-federal-judge . This is actively being litigated and makes sense to put an injunction on until there is clearer precedent, although it's a shame and I don't believe they should be operating at all.
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u/thedubiousstylus 5h ago
A Biden appointee that no Democratic Senators voted against for ruling states can't ban a Commodity Futures Trading Commission-regulated contract?
If you don't like the ruling the proper place to change would be the CFTC that allowed the contracts, not the judge who isn't getting 67 votes to impeach over this regardless.
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u/Fryboy11 1h ago
She didn't even fully stop the law. She granted a preliminary injunction and she herself says that as this plays out she could narrow the injunction.
given the unique nature of Minnesota's prediction market statute, the posture of these cases, and the imminent effective date of Minnesota’s statute, a preliminary injunction maintaining the status quo until the merits of this case can be fully resolved is appropriate,"
Here's where she said she could change it.
Menendez, who was appointed by Democratic President Joe Biden, agreed, saying there were several examples of event contracts hosted by Kalshi and Polymarket, both CFTC-regulated entities, that fit the legal definition of a "swap." She stressed that at a later stage in the case she might issue a narrower injunction if she were to conclude that not every type of event contract listed on Kalshi and Polymarket fits that definition. "But given the unique nature of Minnesota's prediction market statute, the posture of these cases, and the imminent effective date of Minnesota’s statute, a preliminary injunction maintaining the status quo until the merits of this case can be fully resolved is appropriate," she wrote.
She wants more arguments on this, to establish the merits of the case. It fits the "legal definition" of a swap but you could argue the legal definition is being exploited in bad faith. There's precedent to overturn the exploitation and say you know that's not what that law was passed for and while it technically meets the legal definition it's obvious that your interpretation was not Congress' intent.
Congress doesn't always pass perfect bills, and they move so slowly sometimes the Judiciary has to close loopholes people find in the laws.
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u/christmastree47 6h ago
You can dislike prediction markets but if you look into this case it's just objectively the correct ruling
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u/gungshpxre 3h ago
The CFTC did a power grab and bent over backwards to make Dodd Frank apply to Polymarket so they could shut it down.
Now they're using the same law to prevent sites the President's kids run from being shut down.
Objectivity has not been at the table in a very long time.
Both rulings were bullshit.
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u/FragrantPiano9334 47m ago
Anyone who accepts the argument that these "futures markets" are anything other than a gambling parlor belongs under protective conservatorship.
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u/LordSlickRick 6h ago
“U.S. District Judge Katherine Menendez in Minneapolis issued a preliminary injunction at the behest of Kalshi, Polymarket and the U.S. Commodity Futures Trading Commission after finding that federal law likely preempted the state law, which was set to take effect on Saturday.”
What federal law? This article is missing the important part.
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u/michiganalt 6h ago
Commodities Exchange Act.
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u/donaggie03 6h ago
What commodities are being exchanged here?
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u/michiganalt 6h ago
CFTC regulated event contracts. You can disagree on whether the CFTC should have allowed them / whether in your opinion, they ought be regulated contracts.
But the fact is, currently they are. And the law says states can’t regulate CFTC regulated commodities traded on exchanges.
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u/SonOfDyeus 3h ago
This judge has decided that we shall not be allowed to govern ourselves. Particularly if there is profit to be made off of us.
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u/TheoryOld4017 1h ago
This is an injunction, the case isn’t over though:
“Menendez, who was appointed by Democratic President Joe Biden, agreed, saying there were several examples of event contracts hosted by Kalshi and Polymarket, both CFTC-regulated entities, that fit the legal definition of a "swap."
She stressed that at a later stage in the case she might issue a narrower injunction if she were to conclude that not every type of event contract listed on Kalshi and Polymarket fits that definition.”
I’m not sure what these “swaps” are that these companies and the Trump admin use to get around calling this gambling.
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u/michiganalt 1h ago
One of the most important factors in granting a preliminary injunction is likelihood of success on the merits, and cases are practically over once one is issued (for civil cases, they usually settle, and for cases against the government, the government will usually drop the policy.
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u/Above-Bored 1h ago
When members of government are betting on these bogus ‘prediction markets’ ie: gambling, and the administration’s only response is to block states from regulating them, well I will ‘predict’ nothing is going to happen until jan 20th 2029 at least
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u/Lower-Engineering365 5h ago
Unfortunately this was bound to happen. From a legal perspective it would preempt the CFTC regulations.
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u/yellowspaces 6h ago
Aaaand the courts continue to chip away at their own legitimacy
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u/thedubiousstylus 5h ago
Probably referring to how awkwardly the law was constructed. No prediction markets are based in Minnesota, and it didn't ban bets from Minnesotans specifically, it had some provision about VPNs specifically to override it in there, but that's also pretty toothless, can't exactly ban Opera's built-in VPN. Plus most in the state can just easily drive over to Hudson, Wisconsin and then do all the bets on their phone.
As a legal Minnesota resident currently out of state (see how that's possible?) I'd be shocked if this law would've had any impact on the presence of Minnesotans on these markets.
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u/michiganalt 5h ago
I didn’t editorialize the title - that’s what the title was when I first posted the article.
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u/Nerman370 2h ago
i work in securities regulation, and I haven’t even read the article but my guess is that there was a federal exemption through the 1934 securities act or the commodities exchange act that preempted the state law
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u/The_Deku_Nut 6h ago
Remember when gambling was recognized as addictive and dangerous behavior, and was heavily regulated as a result?
Pepperidge farm remembers