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- Donald Trump Jr. privately urged Republican state attorneys general to defer prediction market regulation to federal authorities.
- His advice drew scrutiny due to his disclosed financial and advisory ties to both Kalshi and Polymarket.
Donald Trump Jr. privately urged Republican state attorneys general in March not to target prediction market companies such as Kalshi and Polymarket, according to a report summarized in the source material.
The remarks matter because Kalshi and Polymarket are already at the center of a widening fight over whether prediction markets should be regulated as federally supervised financial products or treated by states as unlicensed gambling. Trump Jr.’s reported comments also draw scrutiny because of his disclosed business ties to both companies.
He reportedly made the remarks at a three-day retreat for Republican state attorneys general at the Ritz-Carlton in New Orleans. According to the source summary, Trump Jr. said prediction markets should be left to federal regulators rather than state gambling officials, and argued state leaders were being pushed by a “vested interest” made up of gambling firms trying to protect their “monopolies.”
Trump Jr.’s reported ties to both platforms
Trump Jr. joined Kalshi as a strategic adviser in January 2025, and the source says his compensation included more than $300,000 in company shares. It also says his venture firm, 1789 Capital, invested in Polymarket and that he joined Polymarket’s advisory board.
Those ties are central to the story because both companies are facing active legal and regulatory pressure in multiple jurisdictions.
On July 31, New York Attorney General Letitia James and Gov. Kathy Hochul sued Kalshi, accusing it of operating an unlicensed gambling business in New York. The attorney general’s office said it was seeking a court order, restitution, forfeiture of illegal gains and fines equal to three times Kalshi’s alleged gains. The source summary says MarketWatch reported potential penalties could reach $36 billion.
State cases and federal pushback keep expanding
The source summary says Baltimore Mayor Brandon Scott and the City Council sued Kalshi and Polymarket on Aug. 13 over alleged unlicensed sports betting. In June, Kentucky Attorney General Russell Coleman sued Kalshi, Polymarket, Coinbase, Robinhood and Webull, accusing them of offering unlicensed sports betting and gambling platforms.
Kalshi has argued that it is a federally regulated exchange and that state gambling rules cannot override that status. The Commodity Futures Trading Commission has designated Kalshi as a contract market since November 2020.
By late June, the CFTC had sued nine states to block state action against CFTC-registered prediction markets, according to the source summary. It also says Arizona Attorney General Kris Mayes filed 20 criminal counts against Kalshi in March, including counts tied to election wagering and sports bets.
What comes next is likely to turn on the same unresolved question running through these cases: whether courts and regulators treat these contracts as prediction-market products under federal oversight or as gambling activity that states can shut down.
Source: As reported by news.google.com.
