Minnesota passes ban on prediction markets, Trump Administration sues

Minnesota's new law will make it illegal to advertise or operate prediction markets in the state.

This week, Minnesota Governor Tim Walz signed a law that bans prediction markets statewide. The Trump Administration has sued in response, seeking to stop the law from going into effect this summer.

As reported by NPR, Walz signed the law on May 19, 2026. The new law will make it a felony to operate a prediction market in the state. This would affect companies like Kalshi and Polymarket, which allow its users to place bets on outcomes related to sports, politics, and miscellaneous world events.

"We as a state should decide how best and what regulations we think should attach to gambling, to protect public safety, to protect our kids," said Minnesota Rep. Emma Greenman.

The Trump Admin’s lawsuit to stop the law from taking effect was announced in a post to the Commodity Futures Trading Commission website. “This Minnesota law turns lawful operators and participants in prediction markets into felons overnight,” said CFTC Chairman Michael S. Selig.

The new legislation represents the most aggressive move by a state to shut down CFTC-regulated markets and undermine the federal regulatory regime set up by Congress more than 50 years ago.

The law also received pushback from Minnesota’s agricultural community as the ban was originally set to impact trading on weather-related events. An updated bill permits trading on weather-related events, and NPR’s report says Tim Walz is expected to sign it soon.

As prediction markets become increasingly popular, we’ve witnessed an equally growing movement to cull them. Last month, the U.S. Senate banned its members from trading on prediction markets after a senator was suspended for insider trading.

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