> sports gambling in prediction markets, which is explicitly illegal

It’s a bit more complicated than that. The CFTC argues that under Dodd-Frank any bet on a future event that can have economic consequences is regulated by the CFTC.

It’s a bit silly because this obviously wasn’t the intention of the legislation, and it would also mean anyone betting outside a CFTC regulated exchange is in illegality. But it’s valid enough that The case will probably go to the Supreme Court.