The CFTC is suing Kentucky after the state’s attorney general sued Kalshi, Polymarket, and sweepstakes casino operator VGW, making Kentucky the ninth state to face federal legal action over prediction market regulation.
Kentucky Attorney General Russell Coleman has sued VGW, the parent company of Chumba Casino and LuckyLand Slots, arguing the sweepstakes casino model constitutes illegal gambling under Kentucky law.
Kentucky AG Russell Coleman filed three separate lawsuits targeting VGW, Kalshi, and Polymarket over alleged illegal gambling operations in the state — the most aggressive state-level action against prediction markets and sweepstakes casinos to date.
A coalition of prediction market platforms including Kalshi, Crypto.com, and Polymarket has filed suit against Kentucky over a newly enacted 14.25% excise tax they say unfairly targets their federally regulated industry.
Kentucky overrode Gov. Beshear’s veto of HB 904, raising the sports betting age to 21, mandating DFS licenses, and restricting sportsbook ties to prediction markets.
Gov. Andy Beshear vetoed HB 904 not over gambling policy, but over a constitutional power dispute — and a veto override is expected as soon as Tuesday.