Minnesota prohibits prediction markets, promptly gets sued by Trump admin

Here’s something that might surprise you — Minnesota just made prediction markets outright illegal, and now the Trump administration is suing. That’s pretty bold for a state to ban a financial tool used by farmers and traders to hedge weather risks, all in the name of cracking down on what it calls ‘federal regulatory undermining,’ as the CFTC’s Michael Selig points out. According to Jon Brodkin reporting for Ars Technica, Minnesota’s law doesn’t just restrict — it effectively kills lawful prediction markets overnight, turning participants into felons. And get this — while other states have imposed restrictions, Minnesota’s move is seen as the most aggressive push to shut down these markets entirely. Now, the Trump administration’s lawsuit aims to challenge that, arguing it’s an attack on longstanding federal rules set by Congress. So what does this mean? It’s a high-stakes showdown that could reshape how prediction markets operate across the country, and whether states can override federal oversight in the process.