The U.S. Commodity Futures Trading Commission (CFTC) and the Department of Justice have filed a motion to prevent Arizona from enforcing its gambling laws against Kalshi, a prediction market operator. The federal regulators argue that contracts related to sports, elections, and other events are financial derivatives, or "swaps," and should be regulated federally under the Commodity Exchange Act, rather than by state gambling laws. Arizona has previously charged Kalshi under state gambling statutes, with an arraignment set for April 13. A federal appeals court in New Jersey previously ruled in favor of Kalshi, stating its contracts are legal under federal law without CFTC intervention. However, other jurisdictions have allowed state actions to proceed. If the court sides with the CFTC, prediction markets could be regulated under a unified federal framework.