Record trading volumes mask deepening US regulatory conflict
Kalshi, a prediction market platform, recorded $9.4 billion in trading volume during June 2026, marking a record month driven by the 2026 FIFA World Cup, which kicked off on June 11 with an expanded 48-team format. Polymarket International logged $4.3 billion in June volume, up from $3.5 billion in May. The World Cup competition became the biggest driver of prediction market trading in June, according to reporting from CNBC and data from Dune Analytics.
Knockout matches attracted the highest trading activity. Canada vs. Morocco generated $48 million in trading volume on Kalshi and $26.8 million on Polymarket International. US Round of 16 matches drew $2.1 million on Kalshi and $1.6 million on Polymarket, showing concentrated interest in major matchups.
The surge underscores the commercial appeal of prediction markets but arrives amid escalating conflict between US federal regulators and state authorities over jurisdiction. By March 2026, nearly a dozen US states had moved against Kalshi and Polymarket, seeking to halt the markets or bring them under state gambling laws and tax frameworks.
The CFTC has rejected state authority over the sector. In April, CFTC Chair Michael Selig accused states of mounting “illegal enforcement actions” and signaled willingness to defend federal jurisdiction in court. “To any state that seeks to nullify federal law and seize authority over these markets, we will see you in court,” Selig said.
That posture has drawn pushback from gaming interests. In June, casino operators, tribal organizations, and labor groups urged Congress to amend the Digital Asset Market Clarity (CLARITY) Act to remove sports-event contracts from CFTC authority, arguing they should remain under state gambling oversight instead.
The regulatory conflict extends beyond US borders. The European Securities and Markets Authority (ESMA) issued guidance stating that many event contracts may fall under existing binary options restrictions based on product characteristics, not labeling. This approach contrasts sharply with the US state-versus-federal standoff.
The outcome of the CLARITY Act amendment push and state-level enforcement actions remains uncertain. Kalshi’s June volumes, while record-setting, operate in a legal environment where multiple jurisdictions claim overlapping authority.
