The PM Pulse 010
Minnesota Injunction, Fanatics Exchange Deal, and Kalshi’s SDNY Setback
Regulatory Updates
Federal Judge Blocks Minnesota Prediction Markets Ban
U.S. District Judge Katherine Menendez granted a preliminary injunction preventing Minnesota from enforcing its new law banning prediction market activity against CFTC-registered designated contract markets. The order comes days before the statute was set to take effect.
The motions were brought by the CFTC, Kalshi, and Polymarket US. Judge Menendez found the plaintiffs likely to succeed, at least in part, on preemption grounds under the Commodity Exchange Act, and that they face a threat of irreparable harm. The injunction maintains the status quo pending a decision on the merits. The court noted that the statute may not ultimately be preempted in every application.
Response from CFTC Chairman Mike Selig:
Source: Court order
SDNY Denies Kalshi’s Emergency Injunction Pending Appeal
Judge Analisa Torres denied Kalshi’s motion for an emergency injunction pending appeal in its New York litigation. The court held that Kalshi failed to make the required “strong showing” that it is likely to succeed on the merits, and characterized the request as seeking the same injunctive relief the court had already denied.
This follows the emergency filing and Second Circuit briefing schedule covered in The PM Pulse 009.
Source: Daniel Wallach
NFL Submits Formal Letter to CFTC on Sports Prediction Markets
The NFL sent a letter to the CFTC arguing that the agency’s proposed prediction market rules “fall significantly short of protecting the integrity of sporting events and the fans who participate in these markets.” The league called for tighter definitions around contracts that resemble gaming activity, longer pre-approval windows, explicit insider-trading safeguards, and league-specific prohibited-bettor lists.
This builds on the NFL government-affairs staff visit to the CFTC reported in The PM Pulse 009.
Source: Dustin Gouker
CFTC Sports Rule Comment Period Closes
The public comment period on the CFTC’s lengthy proposed rule on public interest determinations for event contracts – heavily focused on sports – closed Monday night.
Source: fairplaygov
Company / Product Updates
Fanatics to Acquire CFTC-Registered Exchange and Clearinghouse from BGC
Fanatics announced an agreement to acquire Water Street Labs, LLC (a CFTC-registered Designated Contract Market) and CX Clearinghouse, L.P. (a CFTC-registered Derivatives Clearing Organization) from BGC Group. The deal will allow Fanatics Markets to operate its own federally regulated exchange and clearing infrastructure rather than relying on third-party platforms.
Fanatics and BGC will also partner on market data products that combine prediction market sentiment with traditional financial market data. Financial terms were not disclosed.
A visual from Mick Bransfield maps more than 15 exchanges in line to launch or receive DCM designation:
Source: Fanatics / GlobeNewswire
Other Relevant News
Kalshi Shares World Cup Marketing Results
Kalshi said its World Cup campaign generated more than 29 billion impressions, 5.8 million downloads, and earned Adweek/EDO recognition for best World Cup commercial, with a marketing team of 15.
Source: Brandon Beckhardt
Rothera Reports World Cup Contract Volume
Rothera said it processed 3.44 billion total contracts during the World Cup, or about 29.6 million contracts per game.
Key Takeaway:
Robinhood, which co-owns the exchange with Susquehanna (SIG), has been routing a meaningful share of its prediction-market flow through Rothera – especially World Cup straight bets. As of early July estimates from InGame, roughly 40% of Robinhood volume was going to Rothera and about 60% still to Kalshi.
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