A bipartisan coalition of 41 state attorneys general is calling on the Commodity Futures Trading Commission (CFTC) to affirm that states—not federal authorities—possess authority over sports-related “event contracts.”

The group submitted an official comment to the CFTC, contending that emerging prediction market platforms are operating as unregulated sportsbooks. These platforms, such as notable entities Polymarket and Kalshi, enable users to trade contracts based on the outcomes of sports events—inclusive of game results, point spreads, and individual player performance metrics.

“States are entitled to govern their own gaming industries; historically, they have effectively regulated gambling activities within their jurisdictions,” stated Iowa Attorney General Brenna Bird, one of the members of the coalition, in a press release. “In Iowa, our legislature creates the laws while the Iowa Racing and Gaming Commission ensures compliance, including the collection of applicable taxes.”

She noted that some businesses are attempting to sidestep state regulations and requirements. “Multiple courts have concurred with this coalition’s assertion that sports-related prediction-market firms should adhere to the gambling regulations of individual states.”

The coalition notes that prediction markets are being employed for recreational gambling rather than genuine financial risk management, thereby falling outside the scope of the CFTC’s intended jurisdiction. The attorneys general maintain that a well-established legal framework reserves gambling regulation for the states.

This filing follows the CFTC’s invitation for public input on proposed rules that will govern prediction markets. The coalition is appealing for the agency to formally acknowledge that it lacks jurisdiction over sports-related event contracts, thus safeguarding states’ ability to regulate or ban sports betting operations.

Beyond regulatory concerns, the attorneys general also pointed out the potential public health and financial dangers associated with sports wagering. The coalition emphasized that millions of Americans could face challenges related to problematic or pathological gambling, and asserted that states are more equipped than federal entities to address and mitigate these issues.

The coalition includes attorneys general from a diverse array of states, encompassing Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, Vermont, Virginia, and Wisconsin.