The Commodity Futures Trading Commission (CFTC) filed a motion Wednesday seeking a preliminary injunction and temporary restraining order against Arizona’s enforcement of state gambling laws on prediction markets.

The motion escalates an already historic conflict. The agency sued Arizona, Connecticut, and Illinois last week, marking the first time in its 50-year history that it has sued a state.

CFTC Chairman Michael S. Selig framed the injunction request as a defense of federal authority, noting that the CFTC will vigorously defend its exclusive authority over prediction markets.

“The agency won’t stand for intimidation by states seeking to nullify federal law,” wrote Selig in a post.

It follows a motion in Arizona that builds on a recent filing against States that use criminal and gambling laws to interfere with CFTC-regulated prediction markets.

Arizona’s decision to weaponize preempted state criminal law against companies that comply with a comprehensive federal regime sets a dangerous precedent… The CFTC is committed to vigorously defending its exclusive authority over prediction markets,” read an excerpt in the press release, citing Selig.

Arizona filed criminal charges against Kalshi in March, alleging illegal gambling and unauthorized election wagering.

The CFTC argues that prediction markets fall under the Commodity Exchange Act (CEA), which grants the agency exclusive federal jurisdiction over event contracts.

.@CFTC Seeks to Enjoin Arizona Criminal and Civil Enforcement Against Prediction Markets: https://t.co/aZv6b0DEGW

However, the platforms the CFTC is defending carry significant financial ties to the Trump family.

Donald Trump Jr. serves as a paid strategic advisor to Kalshi and sits on Polymarket’s advisory board. His venture capital firm, 1789 Capital, invested millions into Polymarket in August 2025.

The connections extend further. Trump Media & Technology Group (TMTG) partnered with Crypto.com to build Truth Predict, a prediction market platform for Truth Social.

Crypto.com has donated at least $35 million to MAGA Inc., Trump’s primary Super PAC.

Robinhood announced Monday it will serve as the brokerage and initial trustee for Trump Accounts. All four companies received cease-and-desist letters from the states the CFTC is now suing.

Georgia State University professor Todd Phillips told NPR the federal suits go beyond advocacy. He described them as an attempt to tilt the scales in favor of prediction markets.

We're deeply concerned by this suit for a number of reasons– namely, that Donald Trump Jr. advises both Kalshi & Polymarket. He stands to profit off of these platforms' success. https://t.co/eB2us4rM2T

Connecticut Attorney General William Tong pushed back, calling prediction market contracts plainly unlicensed illegal gambling and pledging to defend state consumer protection laws.

The Ninth Circuit will hear oral arguments on April 16 in a consolidated case involving Kalshi, Robinhood, and Crypto.com.

That ruling could determine whether prediction markets operate under one federal framework or face state-by-state restrictions.

The post Trump’s CFTC Shields His Family’s Prediction Market Partners From Prosecution appeared first on BeInCrypto.

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