* Bloomberg…

Prediction market providers and the US derivatives regulator secured a win in Illinois federal court over sports event contracts, bucking a recent losing streak for the multibillion-dollar industry on a nationwide dispute that appears to be racing toward the US Supreme Court. […]

The latest ruling even creates a split within the Seventh Circuit, as a federal judge in Wisconsin allowed the state to continue regulating sports prediction markets as gambling.

“Friday’s ruling means there’s an intracircuit split at the Seventh Circuit due to the earlier ruling in the Wisconsin district court,” said Gary Kalbaugh, a derivatives partner at Cahill Gordon & Reindel LLP. “Historically, the Seventh Circuit has been perceived as a friendly court for CFTC-regulated markets.” […]

“Until the Supreme Court rules, and with the CFTC continuing to advance its position, this checkerboard approach of where prediction markets can operate and not operate under the various court decisions, it’s going to be very uneven and that’s not good for anybody,” said Adrian King, co-leader of Ballard Spahr LLP’s gaming and state attorneys general teams. “And that’s why we’re all patiently waiting for the Supreme Court.”

* The Hill…

A bipartisan group of states (including Illinois) 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. […]

“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.”

* Related…

* Sun-Times | Federal judge sides with Kalshi, blocks new Illinois rules on prediction markets: Illinois’ law calls for the state to take a percentage of transaction fees charged by prediction market companies, which offer “yes” or “no” event contracts on everything from whether the White Sox will advance to the World Series, to the weather in Chicago. […]“Many of the financial instruments at issue are likely swaps as defined by the Commodity Exchange Act — they just happen to be swaps that people find entertaining and fun,” Pacold wrote. “Under the Act and precedent interpreting it, some Illinois law is likely preempted. Plaintiffs are therefore likely to succeed — at least in part.” Pacold still signaled she’s open to upholding the state tax on transaction fees, which were originally scheduled to take effect in July. State lawmakers, anticipating the legal battle, didn’t count on revenue from the prediction market tax in their budget projections.

* CNBC | NFL tells Supreme Court prediction markets are gambling and should be regulated by the states: The NFL says on the first Sunday of the season, football accounted for $1.8 billion in prediction markets trading, more than half the total volume. The NFL says it isn’t opposed to prediction markets. “In the end, we believe that given the current resource constraints of the CFTC, this is a job better left to the states,” the league told CNBC. The league is concerned about contracts that are vulnerable to manipulation, like field goals where a kicker could intentionally miss or a wide receiver intentionally fumbling a pass. The NFL is also concerned about bets tied to injuries, officiating and other information insiders could know in advance. The NFL wants a minimum age of 21 for bettors, as most states mandate for sports betting. On Kalshi, customers can be as young as 18.

* NPR | As crypto and prediction markets expand, their regulator shrinks: Trump-era staff reductions have significantly hampered enforcement at the Commodity Futures Trading Commission and its ability to regulate burgeoning new prediction and cryptocurrency markets, where hundreds of billions are traded each week. By the end of 2025, the CFTC had 21% fewer staff on its payroll when compared to the previous 10-year average, according to U.S. Office of Personnel Management data. Between January 2024 and January 2025 alone, staffing dropped 22%. And the number of CFTC enforcement actions dropped even further. The agency made nearly 80% fewer enforcement actions in 2025 when compared to the annual average for the previous decade, according to the agency’s annual reports.

* Politico | Bipartisan coalition of states urge Supreme Court to let them regulate prediction markets: The legal clash, the amicus brief said, “has splintered the circuits and lower courts with no resolution on the horizon. Only this Court can provide the much needed answer. It should do so.”