Attorney General Brenna Bird Urges Commodity Futures Trading Commission to Recognize State Authority Over Sports-Related Prediction Markets

DES MOINES—Attorney General Brenna Bird announced today she has joined a bipartisan coalition of 41 attorneys general in urging federal regulators that states should have jurisdiction over sports-related “event contracts.”

"States have the right to govern their own gaming industry; historically, they’ve been successful at regulating gambling within their borders,” said Attorney General Bird. “Here in Iowa, our legislature makes the laws, and the Iowa Racing and Gaming Commission enforces the laws, including the payment of any taxes required. These companies are trying to get around those state regulations and taxes. Several courts have agreed with the request of this coalition already, that sport-related prediction-market companies should be subject to an individual state’s gambling rules.”

The coalition filed a formal comment with the Commodity Futures Trading Commission (CFTC), arguing that prediction markets – platforms where users trade contracts on the outcome of future events – have effectively become unregulated sportsbooks. The platforms, including Polymarket and Kalshi, allow users to place wagers on game winners, point spreads and player statistics, bypassing the consumer protections and tax requirements mandated by state gambling laws.

Because the contracts are considered entertainment-based gambling rather than tools for financial risk management, they fall outside the CFTC’s jurisdiction, the coalition says. The letter notes that gambling regulation is a state power under well-established case law.

The coalition’s letter responds to a CFTC request for public comment on proposed rules for prediction markets. The states urge the commission to confirm through rulemaking that it lacks jurisdiction over sports-related contracts, ensuring that the power to regulate or prohibit sports gambling remains with states.

Attorney General Bird and the coalition also caution that sports gambling poses serious risks to public health and financial security, with millions of Americans qualifying as problematic or pathological gamblers. The coalition asserts that states – not the CFTC – are best equipped to protect their residents from the associated harms.

Joining Attorney General Bird on the coalition are the attorneys general of 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.

Read the full letter here.

###

For More Information:

Contact: Jen Green | jen.green@ag.iowa.gov