Majority of states urge Supreme Court to consider prediction market regulation

A bipartisan group of states are backing New Jersey’s request for the Supreme Court to declare that states can regulate prediction markets , warning that lower judges are “hopelessly confused and divided.”

Last month, New Jersey petitioned the justices to decide the issue that has been bubbling up in the lower courts. The justices turn away the vast majority of cases but are set to consider hearing it at a closed-door meeting later this term.

Major platforms like Kalshi and Polymarket — supported by the Trump administration — say the federal government should be in control, not states.

“The prediction markets are wrong,” the group of states wrote in their amicus brief supporting New Jersey, docketed on Wednesday.

“They cannot strip the States of their core sovereign power through relabeling and window-dressing,” the brief continued. “Our constitutional structure is much more durable than that. And the promise of federalism ensures that States do not lose their ability to protect their citizens so easily.”

The bipartisan coalition was led by Ohio Attorney General Andy Wilson (R) and joined by the District of Columbia and 38 other states

States retain broad authority to regulate and tax gambling in their borders, but prediction markets argue their products are distinct from those traditional offerings.

Platforms like Kalshi say their products should be deemed “swaps” under federal law, which would place it under the authority of the federal Commodity Futures Trading Commission (CFTC). The states, however, said that theory would undermine their gambling regulations , arguing it eliminates “guardrails” and threatens their citizens’ safety.

“That almost all the nation’s States have spoken with one voice on the matter should be enough,” they wrote.

The case arrived at the Supreme Court after Kalshi sued New Jersey last year to block the state from enforcing its gambling laws against the company. The company won before the 3 rd U.S. Circuit Court of Appeals, part of an emerging split among the appeals courts around the country.

As the Garden State now brings the issue to the justices for the first time, it has also garnered support from the National Football League (NFL).

The NFL raised concerns about whether the CFTC has sufficient resources to ensure prediction markets “do not jeopardize game integrity.”

“All this stands in stark contrast to state gaming authorities, which have engaged with the NFL for years to establish structural safeguards that provide core integrity protections,” the NFL wrote in its brief , filed on Thursday.