CFTC complaint says that, for Congress, transactions regulated under the Commodity Exchange Act are not gambling
Commodity Futures Trading CommissionCommodity Futures Trading Commission, co-plaintiff with the United States in the federal complaint against Utah
In its federal complaint against Utah, the CFTC argues that Congress, by excluding transactions on CFTC-registered exchanges from the federal definition of a bet or wager, treated transactions regulated under the Commodity Exchange Act as something other than gambling.
“For Congress, then, CEA-regulated transactions are not gambling.”
Original text
Where this statement fits
Utah charges Kalshi and its founders with felony gambling promotion; Kalshi calls it 'a crazy overreach'
On October 28, 2026, the Utah Attorney General's Office filed criminal charges in state court against the prediction market KalshiEX LLC and its co-founders, chief executive Tarek Mansour and chief operating officer Luana Lopes Lara, alleging that Kalshi provided online gambling to an undercover agent in Utah. Attorney General Derek Brown says a federal court has already ruled that Utah's gambling laws apply to Kalshi, a ruling Kalshi has appealed. Kalshi calls the case 'a crazy overreach' and says Utah is playing politics. The Commodity Futures Trading Commission, which sued Utah two days earlier, says federal law preempts state gambling law for event contracts on the exchanges it regulates.
Source and context
Original text
About this source
Complaint for declaratory and injunctive relief filed October 26, 2026, in the U.S. District Court for the District of Utah. The United States and the CFTC argue that event contracts on CFTC-registered exchanges are swaps under the Commodity Exchange Act and that federal law preempts Utah's gambling laws as applied to them, and ask the court to bar Utah from enforcing those laws against the exchanges.
Archived copy (opens in a new tab)Before the quotation
The United States and the CFTC filed this complaint on October 26, responding to the enforcement action Utah filed against Kalshi and other companies in state court on October 20. Just before this sentence, the complaint says Congress excluded transactions conducted on or subject to the rules of a registered entity under the Commodity Exchange Act from the definition of a bet or wager in the Unlawful Internet Gambling Enforcement Act of 2006.
After the quotation
The complaint goes on to argue that Congress embraced preemption for swap transactions in the Dodd-Frank Act. It asks the court to declare Utah's laws preempted as applied to transactions on CFTC-regulated exchanges and to bar the state from enforcing them against those exchanges.
How this statement is classified
The label describes this statement's response within the context above.
Why this label?
Relative to Kalshi's offering, the joint complaint challenges treating federally regulated event contracts as gambling.
- Recorded on
- Published here
- People and groups discussed
- Derek Brown
More from this case
Read the full caseKalshi calls Utah's criminal case 'a crazy overreach' and says the state is playing politics
KalshiEX LLC
“This is a crazy overreach; Utah is clearly playing politics. We look forward to putting a stop to this in court, just like we did in Arizona.”Read statement
Derek Brown says Kalshi kept taking bets from Utahns after a federal court ruled that Utah's gambling laws apply
“Gambling is illegal in Utah, whether you place the bet, run the game, or promote it. Calling it a ‘prediction market’ doesn’t change what it is, and being federally registered doesn’t put a company above the law. A federal court has already ruled that Utah’s gambling laws apply to Kalshi. Kalshi kept taking bets from Utahns anyway. That is illegal, and we’re putting a stop to it”Read statement
CFTC Chairman Michael Selig says event contracts inform the public and that the CFTC will defend its exclusive jurisdiction
“Event contracts do not just serve hedging and investment purposes—they also provide the public with information about the outcome of future events. Congress entrusted the CFTC to be the federal regulator with sole responsibility to oversee these markets. As I’ve said before, the CFTC has the expertise and responsibility to defend its exclusive jurisdiction over commodity derivatives, and that’s exactly what we’ll do.”Read statement
Share or embed this statement
The embed keeps its attribution link to The Dispute Index. Credit the image to The Dispute Index and link to the statement page.
Cite this record
- Publisher
- The Dispute Index
- Title
- CFTC complaint says that, for Congress, transactions regulated under the Commodity Exchange Act are not gambling
- First published
- Last updated
- Permalink
- https://disputeindex.com/events/7242-in-its-federal-complaint-against-utah-the-cftc
Last updated marks the most recent saved version of this published statement.
The Dispute Index. "CFTC complaint says that, for Congress, transactions regulated under the Commodity Exchange Act are not gambling". First published: 2026-10-30. Last updated: 2026-10-30. https://disputeindex.com/events/7242-in-its-federal-complaint-against-utah-the-cftc