Trump Jr. tells states to back off prediction market regulation

The New York Times reports that Donald Trump Jr. told a closed-door meeting of Republican state attorneys general in New Orleans this past March that prediction markets already fall under federal jurisdiction and should stay there. His argument, as described, wasn’t just that states lack the authority — he suggested state officials pushing back might be doing so because gambling companies want the current market structure protected, not because of any principled regulatory concern. That’s a pointed accusation to make to a room full of sitting AGs, and it puts him directly at odds with regulators who see this differently.

He’s not a neutral observer here. Trump Jr. holds a strategic advisor role at both Polymarket and Kalshi, the two companies with the most to gain if prediction markets keep operating under federal oversight instead of getting pulled into state gambling law. Kalshi has said his job there is marketing strategy specifically, not regulatory matters, which draws a line meant to keep the advocacy and the advising separate on paper. Whether that line holds up once someone with his name and his access starts telling state officials how to think about the rules is a fair question, and it’s one the framing itself doesn’t really answer.

The underlying fight is already in court. The CFTC has filed suit against nine states that tried to apply their own gambling regulations to sports-event contracts, arguing federal jurisdiction should override anything a state legislature wants to do here. States see it the opposite way — a contract that pays out based on who wins a football game looks like a bet no matter what a company calls it, and they argue it should fall under whatever gambling law already governs betting within their borders.

Nine lawsuits in, neither side is close to backing down. Sportsbooks do have a real incentive here too — a prediction market treated as a federally regulated exchange skips the state license fees and oversight a betting operator has to carry. Whether that’s the actual motive behind state pushback, as Trump Jr. suggested, or states simply think these contracts look like gambling, is exactly what this fight still hasn’t settled.