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Federal Government Sues Illinois Over Prediction Markets, Intensifying Federal-State Jurisdiction Fight

The U.S. federal government has filed suit against Illinois in federal court in Chicago, arguing the state's attempt to police prediction markets violates federal law, Reuters reported. The complaint, filed April 2, challenges Illinois cease-and-desist letters sent to platforms including Kalshi and Polymarket, saying they improperly interfere with CFTC-regulated designated contract markets and encroach on the federal government's exclusive authority over national swaps markets.
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