CFTC sues Utah to shield Kalshi from state gambling crackdown

The Commodity Futures Trading Commission has taken Utah to federal court. The goal is to stop the state from shutting down Kalshi’s prediction markets within its borders. Utah has banned gambling in its constitution since it became a state in 1896. The CFTC’s position is that federal derivatives law sits above that ban. What the CFTC is asking for The CFTC and the US Department of Justice filed the suit on October 26, 2026, in the US District Court for the District of Utah. The defendants are the State of Utah and Attorney General Derek Brown. The federal government wants both preliminary and permanent injunctions. Those would block Utah from enforcing its gambling laws against prediction markets regulated by the CFTC. Kalshi and its affiliates are the immediate concern. The timing was fast. Brown filed a state lawsuit against multiple Kalshi entities on October 20, 2026. Federal regulators answered six days later. Utah’s complaint accuses Kalshi of enabling illegal gambling. The state wants the company’s operations there halted. It also seeks to recover alleged fees ranging from $30.6 million to $61.2 million. Kalshi reportedly had more than 32,000 accounts in Utah as of early 202...