FRANKFORT (Kentucky Today) – Following the 152nd running of the Kentucky Derby, Attorney General Russell Coleman is defending Kentucky’s authority to regulate sports betting on prediction market platforms such as Kalshi and Polymarket. In a letter to the chairman of the Commodity Futures Trading Commission, a bipartisan coalition of state attorneys general argued the CFTC does not have jurisdiction over sports-related contracts offered on the platforms.
Prediction markets allow users to trade contracts tied to the outcomes of future events. The platforms enable wagers on game winners, point spreads and player statistics while bypassing consumer protections and tax requirements established under state gambling laws. Attorneys general contend the “event contracts” are essentially no different than traditional sports betting already regulated in Kentucky by the Kentucky Horse Racing and Gaming Corporation.
Kentucky has regulated sports wagering long before Congress created the CFTC in 1974. The Kentucky General Assembly established the first Kentucky Racing Commission in 1906 “to regulate the racing of running horses in the Commonwealth.” In the letter, the attorneys general argued states already have the tools and experience needed to oversee sports betting and protect consumers from problem gambling.
“There’s not a dollar’s worth of difference between prediction markets’ sports contracts and sports betting, and Kentucky has the jurisdiction and the responsibility to set the rules of the road,” Coleman said. “Along with nearly every other AG in the country, we’re asking the federal government to recognize that states like Kentucky are well-positioned to protect our people, just like we have been doing for over a century.”
The attorneys general warned that sports gambling carries significant risks to public health and financial security, noting that millions of Americans meet the criteria for problematic or pathological gambling. The coalition argued states — not the CFTC — are in the best position to address those concerns and protect residents from harm.
Coleman joined the comment letter led by attorneys general from Ohio, Nevada, Tennessee, New York, Utah and New Jersey. Attorneys general from Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nebraska, New Mexico, North Carolina, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Vermont, Virginia and Wisconsin also signed onto the effort.
