The U.S. Commodity Futures Trading Commission (CFTC) has filed a lawsuit against Minnesota, challenging the state's new law banning prediction markets. The lawsuit, filed in the District of Minnesota, argues that Senate File 4760 oversteps state authority by prohibiting the advertising, creation, and operation of prediction-market platforms, such as Kalshi and Polymarket, within the state. The CFTC contends that this law conflicts with federal regulation under the Commodity Exchange Act, which grants the agency exclusive jurisdiction over derivatives and event contracts. The CFTC seeks both preliminary and permanent injunctions to prevent the Minnesota law from taking effect on August 1, asserting that it would criminalize federally approved exchanges and contracts. This legal action highlights a significant tension between state and federal regulatory frameworks, with the CFTC emphasizing its role in overseeing prediction markets. Kalshi has described the Minnesota law as unenforceable, while Polymarket has not commented. The outcome of this case could set a precedent for similar state-level challenges across the U.S.