New Jersey Asks U.S. Supreme Court To Resolve Kalshi Sports Prediction Market Dispute

Gambling New Jersey asks Supreme Court to shut down prediction markets !6abc Digital Staff Image By6abc Digital Staff!WPVI logo Thursday, September 3, 2026 12:06PM !New Jersey asks Supreme Court to shut down prediction markets The Supreme Court could decide later this fall whether to hear the case. WPVI New Jersey is pushing back on prediction markets. The Garden State has become the first to ask the Supreme Court to shut down the sites, arguing companies -- like Kalshi -- refuse to follow its gambling laws. The Supreme Court could decide later this fall whether to hear the case. If they do, the justices will determine whether prediction markets can continue in their current form. New Jersey's Attorney General, Jennifer Davenport, says the companies have no right to offer sports bets without following state laws. Davenport says those laws have been adopted to prevent compulsive gambling, insider trading, and gambling by minors. Report a correction or typo Copyright © 2026 WPVI-TV. All Rights Reserved. Related Topics NEW JERSEY GAMBLING LAWSUIT * U.S. SUPREME COURT Watch Live ON NOW NTSB details final moments before deadly mid-air crash in Carlisle Concerns amid escalating measles outbreak in Amish Country Penn grad killed in NYC stabbing just returned from maternity leave

Lawsuits brought against other sports betting sites like DraftKings and FanDuel allege online wagering platforms are contributing to gambling addiction, particularly among younger users. Add Your Comments Connecticut has filed a lawsuit seeking to stop the prediction market Kalshi from offering sports event contracts to residents of the state, alleging it is actually operating an illegal, unlicensed sports betting platform. Thecomplaint (PDF)was brought by the State of Connecticut in Connecticut Superior Court on August 26, naming KalshiEX LLC as the sole defendant. Kalshi has allegedly offered sports wagers to Connecticut residents since January 2025 through its website, app and other channels, yet the state maintains the platform has never held or attempted to obtain the license required to offer sports wagering in its jurisdiction. Following a 2018 U.S. Supreme Court decision that paved the way for states to legalize sports betting, a number of traditional sportsbooks have begun operating online. Platforms such as DraftKings and FanDuel have introduced millions of younger adults to the ability to place bets from their smartphones at any time of day. However, that rapid expansion has also helped fuel a wave ofsports betting addiction lawsuitsalleging the companies promoted addictive gambling behavior and failed to protect vulnerable users. Connecticut legalized sports betting in 2021, but online wagering in the state generally must operate through one of three master wagering licensees: the Mashantucket Pequot Tribe, Mohegan Tribe and Connecticut Lottery Corporation, or licensed entities operating on their behalf. Billing itself as a “prediction market,” Kalshi claims it does not fall under that purview, allowing users to buy and sell “event contracts” based on whether future events will occur. The platform offers contracts involving sports, elections, weather, interest rates and other subjects, characterizing the transactions as financial products rather than conventional wagers. Gambling addiction and severe financial losses have been linked to popular sports betting platforms like DraftKings, FanDuel, and Caesars. Lawsuits are being filed by young adults and students who were targeted by deceptive promotions, addictive app features, and aggressive marketing tactics. Gambling addiction and severe financial losses have been linked to popular sports betting platforms like DraftKings, FanDuel, and Caesars. Lawsuits are being filed by young adults and students who were targeted by deceptive promotions, addictive app features, and aggressive marketing tactics. In the complaint, Connecticut maintains Kalshi’s sports event contracts are simply “sports wagers under another name,” offering bets on game and series winners, season win totals, league rankings, points scored and individual player statistics, as well as “combos,” which the state describes as essentially parlays. For its part, Kalshi argues its contracts are federally regulated derivatives under the Commodity Exchange Act and cannot be regulated or prohibited by individual states such as Connecticut. According to the lawsuit, the Connecticut Department of Consumer Protection sent Kalshi and other prediction-market providers cease-and-desist letters in December 2025. In response, Kalshi filed a federal lawsuit seeking to prevent state officials from enforcing Connecticut gambling laws. On August 7, a federal judge denied Kalshi’s request for a preliminary injunction. The filing notes that courts in several other states, as well as the Sixth Circuit, have similarly rejected Kalshi’s argument that federal law shields its sports contracts from state gambling regulations. Connecticut also alleges Kalshi operates outside consumer safeguards imposed on licensed sportsbooks, including a state law prohibiting sports betting by anyone under 21. Kalshi allegedly allows individuals 18 and older to create accounts and wager on sporting events, meaning some high school students may qualify for accounts despite being too young to legally gamble in Connecticut. The complaint further accuses Kalshi of marketing to individuals under 21 and paying minors to create promotional content. Specifically, the state claims Kalshi briefly used a 15-year-old video game streamer as an affiliate and promoted an ambassador program targeting students at Yale and other universities. Connecticut also claims Kalshi deceptively represented its sports contracts as legal nationwide. The complaint reproduces an advertisement describing Kalshi as “The First Nationwide Legal Sports Betting Platform.” Moreover, the state alleges Kalshi uses investment terminology such as trading, financial strategy, price fluctuations and market risk to advertise its contracts. Connecticut argues that language misleadingly portrays risky sports wagers as investment products that may provide financial security. “Kalshi often implies in its advertisements that users have a greater chance of winning compared to sportsbooks participating in the regulated marketplace, in violation of Connecticut’s advertising and marketing requirement that master wagering licensees not imply greater chances of winning compared to other licensees.” —State of Connecticut vs. KalshiEx LLC The lawsuit raises allegations of unfairness, illegal sports wagering, underage gambling and deception. It seeks injunctive relief under Connecticut’s sports wagering laws, for the court to permanently prevent Kalshi from offering unlicensed sports wagering in the state, restitution for consumers, civil penalties and disgorgement of revenues and profits. Connecticut’s concerns about prediction markets like Kalshi come amid a growing number ofDraftKings lawsuitsandFanDuel lawsuitsfiled over allegations that online wagering platforms contributed to gambling addiction, particularly among younger users. Many claims allege the platforms used algorithms to identify customers who showed signs of compulsive gambling and then targeted them with personalized promotions, loyalty rewards and, in some cases, dedicated account representatives. The lawsuits maintain these practices encouraged continued wagering while minimizing the financial risks associated with gambling. Amid the growing litigation,gambling addiction lawyersare reviewing potential claims for individuals who suffered substantial financial losses through sports betting and other online wagering platforms. Individuals who believe they may qualify for asports betting addiction lawsuitcan submit information for a free legal review. Claims are handled on a contingency fee basis, meaning there are no upfront costs and attorneys are paid only if compensation is obtained through a settlement or verdict. To stay up to date on this litigation,sign up to receive sports betting addiction lawsuit updatessent directly to your inbox. Senior Editor & Journalist Michael Adams is a senior editor and legal journalist at AboutLawsuits.com with over 20 years of experience covering financial, legal, and consumer protection issues. He previously held editorial leadership roles at Forbes Advisor and contributes original reporting on class actions, cybersecurity litigation, and emerging lawsuits impacting consumers. NOTE: Providing information for review by an attorney does not form an attorney-client relationship. Δ

New Jersey yesterday asked the Supreme Court to rule on whether states can regulate sports betting on prediction markets such as Kalshi. “Companies like Kalshi claim to offer legal sports betting in all 50 states, but they refuse to follow the gambling laws of any state,” New Jersey Attorney General Jennifer Davenport said in a press release announcing the lawsuit. In April, the US Court of Appeals for the 3rd Circuit ruled that New Jersey cannot regulate sports bets on prediction markets. The court determined that sports-related event contracts meet the legal definition of “swaps,” giving the US Commodity Futures Trading Commission (CFTC) exclusive jurisdiction. New Jersey’s petition to the Supreme Court said, “The issue is one of tremendous practical and legal consequence: Kalshi seeks to federalize the multi-billion-dollar sports betting industry at the expense of every state sports gaming law. And the decision [by the 3rd Circuit] is badly mistaken.” New Jersey’s petition to the Supreme Court came about a week after the 9th Circuit appeals court ruled that Nevada can stop Kalshi from allowing sports bets. Unlike the 3rd Circuit, the 9th Circuit judges determined that sports betting labeled as swaps is just gambling with a different name. The split between circuits “has tremendous importance, as it will determine whether a multi-billion-dollar gaming industry can suddenly operate free from state sports-gaming laws,” New Jersey’s petition said. Circuit split raised odds of Supreme Court taking case The circuit split dramatically raised the odds that the Supreme Court will step in and determine who’s right, although Kalshi itself reportedly said it won’t allow bets on the case. Davenport’s office said New Jersey’s petition asks the Supreme Court “to hear a question that divided courts nationwide: whether prediction markets can offer sports wagers without following state sports-gambling laws.” “Litigation regarding these questions has erupted across at least 20 states, with dozens of active suits pending and the gambling laws of several states currently enjoined by the federal courts,” Davenport’s office said. “This is the first certiorari petition filed with the US Supreme Court regarding the legality of this business model—of offering sports wagers self-certified by Kalshi with the Commodity Futures Trading Commission (CFTC) without following state laws.”

NJ wants Supreme Court to let states regulate prediction markets 2-minute read New Jersey authorities have asked the U.S. Supreme Court to weigh in on whether states can police prediction market companies such as Kalshi the way they already do with sports betting operations. In the petition to the Supreme Court filed Wednesday, Sept. 2, New Jersey Attorney General Jennifer Davenport argues that firms such as Kalshi and Polymarket are essentially sports-betting platforms and need to be treated as such. “Companies like Kalshi claim to offer legal sports betting in all 50 states, but they refuse to follow the gambling laws of any state,” Davenport said in a statement Wednesday. “These companies have no right to offer their sports bets without following state law, which is why dozens of states across the ideological spectrum have opposed them.” Story continues below photo gallery Kalshi — and other firms including Polymarket — have argued that they don’t offer gambling. Instead, they’re “futures markets” or exchanges “where users buy/sell outcome-based contracts" — often digital — "on real-world events,” according to an explainer by Casino.org. Because the federal government does not consider it gambling or sports betting, it can be offered to people as young as 18, while traditional sports betting and gambling is limited to people at least 21 years of age. New Jersey officials have criticized these firms for operating in the state without gambling licenses in violation of the state’s gambling laws. Trump opposes state regulation of prediction markets Under the Trump administration, the Commodity Futures Trading Commission, or CFTC, has staunchly opposed any state-led efforts to regulate prediction market firms. The president’s son, Donald Trump Jr., serves in an advisory role for both Polymarket and Kalshi. The Biden administration in 2024 floated a ban on bets related to political events, but the Trump administration has backed off from that proposal. Critics have also called prediction markets a form of insider trading. For example, in the days leading up to initial U.S.-Israel strikes on Iran, the Polymarket account “Magamyman” made $553,000 in bets on the removal of Iran’s supreme leader, Ayatollah Ali Khamenei, NPR reported. On April 24, in a separate incident, U.S. Army Special Forces soldier Gannon Ken Van Dyke was charged in connection with placing bets on Polymarket on the outcome of the top-secret raid to capture former Venezuelan President Nicolás Maduro. And in July, ABC News reported that the president’s longtime teleprompter operator is believed to have made tens of thousands on Kalshi betting on more than a dozen of Trump’s speeches. "Kalshi is an open, nationwide financial exchange. It cannot be regulated by 50 different regulators," reads a statement from Kalshi spokesperson Dani Lever. "Both the Third Circuit and the District of New Jersey sided with Kalshi because the CFTC’s exclusive jurisdiction preempts state law." Representatives for Polymarket and the CFTC did not immediately return emails Wednesday seeking comment for this story. Court sided with prediction markets before In a 2-1 decision in April, the U.S. Court of Appeals for the Third Circuit ruled that New Jersey gambling regulators cannot prevent prediction market firms from accepting wagers on sports. The judges ruled that the CFTC under the Trump administration has exclusive jurisdiction over prediction markets. Kalshi’s founder and CEO, Tarek Mansour, called the April court decision “a big win for the industry and millions of users.” Story continues below chart “People use prediction markets because they’re more fair, transparent, and reward being right,” he said on X, formerly Twitter. “Free markets work. We should keep them that way.” New Jersey’s Davenport, in the petition, is asking the Supreme Court to overturn that decision. “We’re calling on the Supreme Court to resolve this issue and recognize that Congress did not silently make the sports-betting industry immune from state law,” she said Wednesday. Daniel Munoz covers business, consumer affairs, labor and the economy for NorthJersey.com and The Record. Email: [email protected]; Twitter:@danielmunoz100, Facebook and Instagram

Michigan Court Orders Kalshi to Block Sports Contracts Michigan has secured another court victory in its growing legal battle with prediction-market operator Kalshi. An Ingham County Circuit Court judge issued a preliminary injunction requiring Kalshi to block Michigan users from accessing certain sports contracts. The order continues restrictions first imposed through a temporary restraining order in June. The latest ruling raises the financial stakes for Kalshi. Violations could result in a $500,000 daily fine, while Michigan is pursuing disgorgement of profits generated through Kalshi's operations in the state. Michigan Court Extends Restrictions on Kalshi Judge Rosemarie E. Aquilina issued the preliminary injunction after sharply criticizing Kalshi's sports prediction markets. Aquilina characterized Kalshi as a sportsbook "masquerading as an investment opportunity." She also highlighted potential harm prediction markets could cause Michigan residents. In particular, the judge cited "profound" potential mental health harm to Michigan youth when explaining the need for continued restrictions. The ruling follows Michigan Attorney General Dana Nessel's lawsuit against Kalshi. Nessel filed the case in March, arguing that the company violated the state's Lawful Sports Betting Act. Michigan contends that Kalshi allows residents to wager on sports outcomes without obtaining state approval. The state therefore views these contracts as unlicensed gambling rather than ordinary financial products. Nessel welcomed the latest court order and criticized Kalshi's approach to sports contracts. "Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices," Nessel said in a statement. "My office will continue to defend Michiganders and enforce our gaming laws, which ensure gambling revenue is regulated and distributed back into our communities." Injunction Covers Multiple Sports Betting Markets The preliminary injunction targets more than a general category of sports contracts. Instead, it covers Kalshi contracts that functionally resemble traditional sports betting products. The affected markets include moneylines, parlays, over/unders, prop bets, and in-game bets. That distinction could prove important as the case develops. Michigan's argument focuses on how these contracts function rather than how Kalshi classifies them. Traditional US online sportsbooks commonly offer the same types of markets. Michigan therefore argues that Kalshi's products can operate as sports wagering despite being structured as event contracts. For Michigan residents, the order means Kalshi cannot provide access to these sports-related markets while the injunction remains active. Licensed operators, meanwhile, continue operating under Michigan's regulated sports betting framework. Kalshi Faces a $500,000 Daily Penalty The preliminary injunction strengthens restrictions created by Michigan's earlier temporary restraining order. That June order stopped Kalshi from offering or advertising its sports contracts in the state. The latest decision extends those restrictions while the underlying lawsuit continues. More importantly, the potential penalty has increased substantially. Kalshi now faces a $500,000 daily fine for violating the injunction. The order also requires Kalshi to maintain geofencing that prevents Michigan users from accessing prohibited sports contracts. The company must use a third-party geolocation provider licensed by the Michigan Gaming Control Board. These requirements create another operational challenge for Kalshi. The company must ensure its systems consistently identify users located within Michigan. Michigan Seeks Kalshi's Profits Michigan's legal challenge extends beyond stopping Kalshi's sports contracts. The state is also pursuing the disgorgement of profits that Kalshi generated while operating in Michigan. Disgorgement would seek to recover money the state argues Kalshi earned through activities that violated Michigan's gambling laws. That financial claim adds another layer to the dispute. Even if Kalshi changes its Michigan operations, the state could continue pursuing financial remedies tied to its earlier activity. The preliminary injunction does not determine the final outcome of that claim. Instead, it keeps the restrictions in place while the broader lawsuit proceeds. Federal Regulation Remains at the Center Kalshi continues to argue that federal law protects its prediction-market operations. The Commodity Futures Trading Commission (CFTC) designates Kalshi as a Designated Contract Market (DCM). That designation strengthens Kalshi's argument that its event contracts operate within a federally regulated derivatives framework. Kalshi therefore maintains that its sports contracts fall under federal rather than state regulation. The company has relied on this position in legal disputes with regulators across the country. Michigan rejects that argument regarding sports contracts. The state argues that Kalshi's markets effectively allow customers to bet on sporting outcomes without a Michigan license. The legal dispute has also moved between state and federal courts. Kalshi previously attempted to transfer Michigan's lawsuit to federal court. The case ultimately returned to state court, allowing Aquilina to issue the latest injunction. Michigan Adds to Kalshi's National Legal Problems The Michigan ruling arrives as Kalshi faces mounting challenges across the country. Several states have taken enforcement action or filed lawsuits involving Kalshi's sports prediction markets. Those cases center on the same fundamental question: whether federal commodities law prevents states from regulating sports event contracts. The growing disputes create uncertainty for prediction-market operators and customers. Each state can take a different approach while courts determine the boundaries of federal authority. The issue could eventually require a nationwide resolution. New Jersey has already asked the U.S. Supreme Court to determine the extent of state authority over sports prediction markets. What Happens Next for Kalshi? The Michigan injunction does not resolve the underlying legal dispute. Instead, it keeps the restrictions active while the case moves toward a final ruling. For now, Kalshi must block Michigan users from accessing sports contracts covered by the order. The company must also comply with the court's geofencing requirements. Michigan, meanwhile, will continue pursuing its broader legal claims, including potential disgorgement of Kalshi's Michigan profits. The case could have significant implications for Michigan gambling and the wider prediction-market industry. A ruling against Kalshi could strengthen state efforts to regulate prediction markets as gambling products. Conversely, a successful Kalshi challenge could reinforce federal authority over event contracts. For now, Michigan has made its position clear. The state views Kalshi's sports markets as gambling products subject to its laws. Kalshi continues to rely on its federal regulatory status. That conflict will remain central to the future of prediction markets and sports wagering across the United States. More Industry News This site contains commercial content. We may be compensated for the links provided on this page. The content on this page is for informational purposes only. Betting News makes no representation or warranty as to the accuracy of the information given or the outcome of any game or event.

A Michigan court ordered Kalshi to keep contracts related to sports events unavailable to Michigan residents with a preliminary injunction against the prediction market platform, with a penalty of $500,000 per day for non-compliance. Ingham County Circuit Court Judge Rosemarie E. Aquilinasignedthe order on September 1, replacing a temporary restraining order issued in June, and ordered it remain in effect until the date of the court’s final order in Michigan’s lawsuit against Kalshi. Pursuant to the ruling, Kalshi is not permitted to offer, list, execute, or settle any sports contracts for persons located in the state of Michigan, including the following and other products functionally equivalent to betting on sports over the internet: moneyline contracts; parlay contracts; over-under contracts; in-game contracts; and proposition contracts. THE BLOCK: A Michigan state court has issued a preliminary injunction requiring Kalshi to continue blocking state residents from its sports event contracts.The injunction converts a temporary restraining order issued in June. Violations of the order would result in a fine of…pic.twitter.com/UGVLAkHXRu Kalshi must also utilize a third-party geolocation service provider licensed by the Michigan Gaming Control Board,‌ which meets the geofencing requirements set by the Michigan Gaming Control Board. Kalshi must also pay $500,000 for‌ each day in which the court determines Kalshi has failed to comply with the provisions of this order. In March, Michigan Attorney General Dana Nessel, in conjunction with the Michigan Gaming Control Board, filed a lawsuit against Kalshi on behalf of the state‌ government, claiming that the latter had broken the Michigan Lawful Sports Betting Act by allowing Michigan residents to trade on sports-related contracts without approval from the state gaming authority. Read More:CFTC Scrutinizes Kalshi Mention Markets as Sports Word Bets Disappear Michigan maintains that the contracts offered through the federally regulated derivatives exchange are a form of sports betting. Kalshi contended that event contracts on Kalshi’s designated contract market will fall under the Commodity Exchange Act and be regularly overseen by the Commodity Futures Trading Commission. Kalshi removed the case to federal court, and the federal judge granted Michigan’s motion to remand to the Ingham County Circuit Court. Aquilina then issued the June temporary restraining order, which included $120,000/day penalties and geolocation restrictions across the state. 🔴 Michigan court orders Kalshi to block sports betting access, $500K daily fineIngham County Circuit Court Judge Rosemarie E. Aquilina issued a preliminary injunction Tuesday requiring prediction markets platform Kalshi to continue blocking Michigan residents from accessing…pic.twitter.com/UedpK9AlvO As before, the new injunction raised the maximum daily fine that would be imposed if the case was still pending. The new injunction further required Kalshi to serve the order, within three business days, to futures commission merchants that offer sports event contracts on the exchange to their customers. The court further stated that Kalshi was not responsible for the intermediaries’ customers when the location information is under the control of the FCM, but not Kalshi. Read More:New York Targets Kalshi, Polymarket and Coinbase in Sweeping Prediction Market Mark The Michigan lawsuit is part of an active jurisdictional dispute over prediction markets, with state regulators asserting that the contracts on sports events are subject to their respective state gambling laws and Kalshi asserting that contracts on sports events traded on the federally-registered exchange are preempted by federal commodities law. For now, however, Kalshi must continue blocking its covered sports markets in Michigan and must implement the geolocation safeguards described above, although this preliminary injunction does not resolve the merits of Michigan’s lawsuit. Michigan’s lawsuit continues toward a final judgment. Crypto writer living between common sense and volatility. Convinced that Bitcoin survives everything, Ethereum is always “almost ready,” and a bear market is just the market testing your resilience. Seen… Binance’s US arm plans to file for a Designated Contract Market license with the CFTC to launch a... This Europe crypto tax guide 2026 is written for investors who hold, trade, stake, mine, or spend... Hong Kong’s monetary authority, the Hong Kong Monetary Authority (HKMA), has issued its first... Within the regulated cryptocurrency market, trading volume in Russia could reach 4 trillion rubles... We explain everything you need to know about the new order and how it changes the US crypto... For years, the U.S. vs. Europe crypto regulation race appeared to have a clear winner. While Europe... Binance’s US arm plans to file for a Designated Contract Market license with the CFTC to launch a... This Europe crypto tax guide 2026 is written for investors who hold, trade, stake, mine, or spend... Hong Kong’s monetary authority, the Hong Kong Monetary Authority (HKMA), has issued its first... 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The US Supreme Court has the opportunity to clear up a nationwide legal debate over whether sports prediction markets offer wagering or derivatives trading, with New Jersey regulators Wednesday imploring justices to take up their spat with New Jersey seeks high court review of an appellate ruling favoring the prediction market provider. The petition comes a week after another circuit split on whether these offerings are sports bets, subject to state regulation, or hedging tools called “swaps” that are under the purview of a Trump administration that’s aggressively asserted it has sole oversight. “Companies like Kalshi claim to offer legal sports betting in all 50 States, but they refuse to follow the gambling laws of any State,” Attorney General Jennifer Davenport said in an emailed statement about the filing of the petition. “These companies have no right to offer their sports bets without following state law, which is why dozens of States across the ideological spectrum have opposed them.” The petition said prediction market providers offering sports bets have dragged at least 20 states into litigation, generating a “direct, acknowledged, and irreconcilable split between the Third and Ninth Circuits. “That split has tremendous importance, as it will determine whether a multi-billion-dollar gaming industry can suddenly operate free from state sports-gaming laws,” it said. “We disagree with New Jersey’s filing,” Dani Lever, a Kalshi spokeswoman, said in an emailed statement. “Kalshi is an open, nationwide financial exchange. It cannot be regulated by 50 different regulators.” The US Court of Appeals for the Third Circuit, in a 2-1 April decision, said Kalshi was likely to succeed with its argument that the federal Commodity Exchange Act preempts state gaming laws. Kalshi’s sports event contracts were swaps traded on federally-designated contract market, meaning the Commodity Futures Trading Commission has exclusive jurisdiction over them, Judge David J.Porter wrote for the majority. Judge It was the first circuit court to weigh in on the widespread legal fight for regulatory control of the multibillion-dollar industry. Then the Ninth Circuit last week unanimously said that Kalshi’s sports event contracts were bets, not swaps, affirming a lower court’s decision to dissolve a preliminary injunction that had shielded the company. “Both the Third Circuit and the District of New Jersey sided with Kalshi because the CFTC’s exclusive jurisdiction preempts state law,” Kalshi’s Lever said. “While New Jersey points to a recent decision in the Ninth Circuit, that decision agreed with that key principle. Where it differed, it did so based on a regulation that’s in the process of being rewritten. We remain confident in the lower courts’ rulings, and nothing in New Jersey’s filing today changes our view.” Swaps or Not Prediction markets such as Kalshi’s let users put money on a range of yes-no outcomes — for example, if Attorney General Ken Paxton (R-Texas) will win his Senate race or if Purdue will win Friday’s college football matchup. States argue these platforms offer glorified sports betting, providing unlicensed wagering in violation of their laws. Kalshi, Crypto.com, and The Trump administration’s CFTC has aggressively touted that it has exclusive jurisdiction over these designated contract markets. President After the 2008 financial crisis, Congress added and defined swaps in the CEA. “At issue is whether Congress federalized a multi-billion-dollar sports-betting industry via a single word and its definition — ‘swap’ — in Dodd-Frank. After all, if Kalshi is right that it can offer sports bets on federal exchanges irrespective of state law, companies can disregard all state sports-gambling statutes with ease, so long as they register with the CFTC,” said New Jersey’s petition. Dissenting from the Third Circuit majority, Judge Milbank LLP represents Kalshi. The case is Flaherty v. KalshiEX LLC, U.S., cert petition filed 9/2/26. (Updates with Kalshi's comment in sixth, 10th paragraphs.) Learn more about Bloomberg Tax or Log In to keep reading: See Breaking News in Context From research to software to news, find what you need to stay ahead. Already a subscriber? Log in to keep reading or access research tools and resources.

New Jersey brings to the U.S. Supreme Court the dispute over Kalshi's prediction-market, information provided by Reuters February 9, 2026 at 19:19 ((Automated Reuters translation using machine learning and generative AI, please refer to the following disclaimer: https://bit.ly/rtrsauto)) * New Jersey asks the Supreme Court to overturn the appellate court’s decision in Kalshi’s favor * American appellate courts are divided on whether states can regulate prediction markets * Kalshi argues that only the CFTC can regulate it (Addition of details on the case in paragraphs 4, 7 to 11) by Nate Raymond New Jersey authorities asked the U.S. Supreme Court on Wednesday to rule on whether states have the power to regulate sports bets placed on prediction markets operated by Kalshi and its competing platforms. The state asked the Supreme Court to overturn the April decision by a three-judge appellate court, which held that the U.S. Commodity Futures Trading Commission (CFTC) has exclusive jurisdiction over contracts tied to sporting events that Kalshi lets users trade on its platform. “These companies do not have the right to offer their sports bets without complying with state law, which is why dozens of states with diverse ideological backgrounds have opposed it,” said New Jersey Attorney General Jennifer Davenport, a member of the Democratic Party, in a statement. Kalshi, based in New York, did not immediately respond to a request for comment. Kalshi, valued at $22 billion in a recent funding round, is at the center of a legal battle that continues to intensify over the ability of state gaming regulators to oversee the fast-growing prediction-market companies. States contend that companies such as Kalshi operate without the required state licenses, violating gambling laws, including those prohibiting betting for those under 21. Under the administration of Republican President Donald Trump, the CFTC shared the position of the companies that transactions on prediction markets fall exclusively under the agency’s jurisdiction. Davenport asks the Supreme Court to overturn a decision rendered 2-1 by the U.S. Third Circuit Court of Appeals in Philadelphia in favor of Kalshi, which had concluded that the federal Commodity Exchange Act likely preempts New Jersey laws. New Jersey sought the nation’s highest court a few days after another federal appellate court ruled against Kalshi, finding that Nevada gaming regulators could not be prevented from requiring the company to hold a gaming license to allow users to bet on sports results. Those conflicting appellate court rulings have increased the likelihood that the Supreme Court will be compelled to step in to resolve this issue, which lies at the heart of many other nationwide legal cases. At least four states — Nevada, Massachusetts, Michigan, and Washington — have obtained judicial decisions restricting Kalshi’s activities. New Jersey argues that the Third Circuit’s decision rests on the erroneous premise that Congress, by enacting the Dodd-Frank Act following the 2008 financial crisis, tacitly transferred sports-betting jurisdiction from states to the CFTC, while the agency’s mandate was to regulate swaps, a type of derivative contract. “At a minimum, the Dodd-Frank Act is not sufficiently clear to transfer jurisdiction over a multi-billion-dollar sports-betting sector to a federal regulatory agency with no expertise in gaming,” wrote the state’s attorneys.

On Friday, the Ninth Circuit ruled unanimously against Kalshi. The three-judge panel all concluded that Kalshi’s sports markets should not be exempt from state sports betting laws. While this appears to be a major blow to the operator, there is enough in the judgment to give encouragement, according to law professor Melinda Roth. The ruling, which goes against the Third Circuit, sets up a potential Supreme Court showdown between state gambling regulators and prediction markets. New Jersey officially petitioned for the Supreme Court to take the case on Wednesday. “I do not think that the Ninth Circuit ruling against Kalshi has any new consequences, as it was predicted,” Roth told CasinoBeats this week. On Friday, the Ninth Circuit ruled unanimously against Kalshi. The three-judge panel all concluded that Kalshi’s sports markets should not be exempt from state sports betting laws. While this appears to be a major blow to the operator, there is enough in the judgment to give encouragement, according to law professor Melinda Roth. The ruling, which goes against the Third Circuit, sets up a potential Supreme Court showdown between state gambling regulators and prediction markets. New Jersey officially petitioned for the Supreme Court to take the case on Wednesday. “I do not think that the Ninth Circuit ruling against Kalshi has any new consequences, as it was predicted,” Roth told CasinoBeats this week.

New Jersey has asked the Supreme Court to review a case that could determine whether states or the federal government have oversight of prediction markets. "We're calling on the Supreme Court to resolve this issue and recognize that Congress did not silently make the sports-betting industry immune from state law," said Jennifer Davenport, New Jersey's attorney general, in a statement. In the petition, New Jersey is asking the Supreme Court to take up an April ruling from the 3rd U.S. Circuit Court of Appeals, which found that all event contracts are a type of derivative that's regulated at the federal level by the Commodity Futures Trading Commission. "So long as a company offers its sports bets on a CFTC registered market, they claim, state sports-gambling laws all fall away," the petition said. In a statement to CNBC, Kalshi reiterated that its platform is a financial exchange. "We disagree with New Jersey's filing. Kalshi is an open, nationwide financial exchange. It cannot be regulated by 50 different regulators. Both the Third Circuit and the District of New Jersey sided with Kalshi because the CFTC's exclusive jurisdiction preempts state law," said Dani Lever, the platform's spokeswoman. "We remain confident in the lower courts' rulings, and nothing in New Jersey's filing today changes our view." New Jersey's move to get the Supreme Court involved in the dispute is the latest development in a battle between the CFTC and dozens of states for oversight of prediction markets. While the CFTC views sports-related event contracts on prediction markets as "swaps," 44 state attorneys general assert that these contracts amount to sports betting — and thus are under the purview of the states. New Jersey's petition comes after the 9th U.S. Circuit Court of Appeals ruled on Friday that sports-related event contracts are not swaps regulated by the CFTC. That court rejected Kalshi and Crypto.com's appeal for injunctive relief against the Nevada Gaming Control Board. This finding also contradicted the 3rd Circuit's decision. The conflicting rulings from the 3rd and 9th circuit courts have provided an opportunity for the Supreme Court to get involved and review which regulator should have oversight of prediction markets, Bank of America said in a Monday note. "Based on our conversations with legal experts, we think it is still possible the Supreme Court waits until next year before hearing the case as there are still pending cases in other federal circuits," the Bank of America note said. New Jersey's petition argues the split between circuits "justifies certiorari," which is when the higher court requests to review a lower court's decision. "The Third Circuit's profoundly important decision is also profoundly wrong," the petition said. The CFTC did not respond for comment. Shares for gambling operators DraftKings and FanDuel's parent company Flutter Entertainment, were both up by more than 5% after New Jersey filed its petition. Disclosure: CNBC and Kalshi have a commercial relationship that includes customer acquisition and a minority investment.

New Jersey on Wednesday asked the Supreme Court to shut down prediction markets in the state, clearing the way for a potential historic case in which the justices could decide whether this highly popular but controversial industry can survive in its current form. This is the first national-level legal battle over the legality of prediction sites to reach the Supreme Court, and it comes after a string of recent rulings against the companies, including one from a federal appeals court. The high court is likely to consider later this fall whether to accept the case. If it does, it would probably issue a decision by early next summer. Prediction sites like Kalshi and Polymarket allow people to bet on real-world events, such as sports, elections, entertainment, weather, and more. They are structured as financial derivatives markets—not as gambling—and are federally regulated by the Commodity Futures Trading Commission (CFTC). However, a bipartisan coalition of 44 states has argued that these platforms are, in fact, gambling. They contend that prediction companies operate unlicensed sports betting houses and illegally sidestep state gaming regulations, which provide consumer protections and generate billions in state tax revenue. Therefore, New Jersey’s attorney general sought last year to end Kalshi’s sports betting in the state. Kalshi filed suit and a federal district judge prevented New Jersey from taking regulatory action against Kalshi. The Third Circuit Court of Appeals in Philadelphia affirmed that ruling in April by a 2-1 decision. "We ask the Supreme Court to resolve this issue and recognize that Congress did not implicitly exempt the sports betting industry from complying with state laws," New Jersey Attorney General Jennifer Davenport, a Democrat, said in a statement on Wednesday. Following New Jersey’s filing, Kalshi expressed confidence that it will ultimately prevail. "Kalshi is an open, nationwide financial exchange," Kalshi spokesperson Dani Lever said in a statement. "It cannot be regulated by 50 different regulators. Both the Third Circuit and the District of New Jersey ruled in Kalshi’s favor because the CFTC’s exclusive jurisdiction takes precedence over state law." New Jersey’s appeal comes less than a week after another state, Nevada, secured a significant win in a related case on the other side of the country. The Ninth Circuit Court of Appeals ruled Friday by 3-0 that states can regulate prediction markets as sports bets, creating a split in reasoning among the circuits. The Third Circuit previously held that prediction sites are legally distinct from traditional sports books because they offer contracts on events for trading and, therefore, should be federally regulated. The Ninth Circuit rejected that interpretation, stating: "Kalshi’s contracts on sporting events have the very characteristics of sports bets." Kalshi is the most popular prediction site in the country. But so far three states’ regulators have secured court orders to shut down Kalshi and, at least, its sports betting: Nevada, Michigan, and Washington state. (CNN has a partnership with Kalshi and uses its data to cover major events, but CNN’s editorial employees are prohibited from operating in prediction markets). A Rising Industry Kalshi and Polymarket now record billions of dollars in weekly volume, and the Trump administration has made clear it wants these sites to prosper. CFTC Chairman Mike Selig, appointed by Trump, has defended prediction markets and said his agency has exclusive jurisdiction to regulate them. The agency did not intervene in New Jersey’s case but did in Nevada’s, arguing that prediction sites cannot be subject to state laws. Under Selig’s leadership, the CFTC has also sued several other states that attempted to ban prediction sites. In June, the CFTC proposed federal rules that would leave most of the industry intact, including most sports markets. Selig’s proposal rejected calls for stricter regulation by state officials, dozens of lawmakers, addiction experts, and major sports leagues like the NCAA and the NBA. The Trump Factor Questions about a possible Supreme Court intervention in this case are shadowed by the president’s business and family ties to the industry. President Donald Trump’s social media company, Trump Media & Technology Group, announced in 2025 that it would launch its own prediction market, called Truth Predict, though in recent months it has scaled back those plans. And the president’s eldest son, Donald Trump Jr., is an investor and adviser to Polymarket, as well as an adviser to Kalshi. A Trump Jr. spokesman previously said he does not pressure federal officials on behalf of the companies. Trump has spoken publicly only on rare occasions about prediction markets. In April, he lamented that "the entire world, unfortunately, has turned into something of a casino." But in May, he said it was "extremely important" to prevent states from regulating prediction sites so that they can "prosper" under the new rules proposed by the CFTC and Selig, whom he said is "doing a great job."

Source: New Jersey Attorney General Citing New Jersey’s enforcement against Kalshi, the petition presented the Supreme Court with the question of “whether the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act preempted States from regulating sports bets that occur within their jurisdictions if those bets are offered on markets registered with the [CFTC].” Cointelegraph reached out to the CFTC for comment but did not receive an immediate response. Related: Kalshi issues first lifetime ban for Republican politician over insider bets The petition challenges an April opinion from the US Court of Appeals for the Third Circuit, in which judges ruled 2-1 against New Jersey’s gaming authorities, saying Kalshi’s argument that the company had a ”reasonable chance of success” in claiming that the CFTC’s Commodity Exchange Act preempted state law. It specifically challenges the CFTC’s claim that sports bets on prediction market platforms amount to “swaps” under the agency’s purview and argued “federal law does not preempt state sports-gambling laws regardless.” “Because federal law prohibits trading swaps off CFTC-registered markets, a victory for Kalshi would mean that all sports gambling off such CFTC-registered markets would seemingly become illegal even if state law allows it,” said the New Jersey AG’s announcement on the petition. Kalshi spokesperson Dani Lever told Cointelegraph that the company disagreed with New Jersey’s decision to appeal to the Supreme Court, saying that it could not be “regulated by 50 different regulators.“ ”We remain confident in the lower courts’ rulings, and nothing in New Jersey’s filing today changes our view,” said Lever. Event contract on when the US Supreme Court will hear a prediction markets case. Source: Polymarket Whether the Supreme Court justices will take up the issue of prediction markets is unclear. Many experts have been speculating that the justices could weigh in on a case that went to the appellate court in Nevada. Whether the court chooses the Kalshi case in Nevada, the one in New Jersey or an enforcement action against a different company down the road, any potential decision could decide which authorities can regulate prediction markets. Magazine: Who is legally liable when an AI agent goes rogue?

Michigan authorities continue pursuit to block Kalshi as Supreme Court fight looms Kalshi previously said it had been placed in an “impossible position” after federal authorities directed the company to ignore a Michigan restraining order issued in June. Michigan’s attorney general announced that a state court had ordered a preliminary injunction against Kalshi, blocking the prediction markets platform for residents amid what officials called “sports betting [...] masquerading as an investment opportunity.” In a Wednesday notice, Attorney General Dana Nessel said that the Circuit Court for the 30th Judicial Circuit in Ingham County approved an order blocking Kalshi from offering event contracts to state residents. The company could be fined up to $500,000 per day for violations. “Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices,” said Nessel. The Michigan court’s actions were the latest in a series of legal battles between prediction market companies like Kalshi and Polymarket and US state authorities. Nessel filed the lawsuit against Kalshi in March, alleging that the platform violated state law on sports gambling — a claim made in many similar lawsuits across the country. Related: Kalshi issues first lifetime ban for Republican politician over insider bets Notably, the preliminary injunction followed a Michigan court’s June restraining order barring Kalshi from offering sports betting to residents. The US Commodity Futures Trading Commission (CFTC) ordered Kalshi not to comply with the state order and continue operating, an action that the company described as putting it in an “impossible position.” Cointelegraph reached out to Kalshi for comment but did not receive an immediate response. New Jersey petitions US Supreme Court to weigh in on prediction markets The Michigan state court order came the same day officials in New Jersey announced they had filed a petition for a writ of certiorari to the US Supreme Court over the state’s case against Kalshi. The case, if heard by the justices, could potentially end competing legal theories on whether the CFTC or state authorities have jurisdiction over prediction markets. “[I]t would be reasonable for the Supreme Court to take it up, but they also may wait for the cases to be decided on the merits and not simply procedural issues like granting a preliminary injunction or not,” Melinda Roth, a visiting professor of practice at New England Law in Boston, told Cointelegraph. “Nevertheless, I still believe the Supreme Court will take this up, if not from New Jersey’s cert petition, then soon, given the amount of ongoing litigation in this area.” Roth added: “If and when SCOTUS takes it up, then this will likely decide whether sports event contracts are federally regulated by the CFTC or the states have the right to ban and/or regulate them as they see appropriate. I say ‘likely’ because Congress might actually act too. They could act before a SCOTUS review, or even after too.” Some US lawmakers have proposed legislation to address Kalshi and Polymarket customers using insider information on event contracts. In March, Senators Adam Schiff and John Curtis introduced a bill to prohibit platforms registered under the CFTC from listing any event contract that “resembles a sports bet or casino-style game,“ referring jurisdiction to individual states’ authorities. Magazine: Does the Bitcoin rally mean we haven’t wasted our lives in crypto?

Kalshi dijo anteriormente que había quedado en una «situación imposible» después de que las autoridades federales ordenaran a la empresa ignorar una orden de restricción de Michigan emitida en junio. El fiscal general de Michigan anunció que un tribunal estatal había dictado una medida cautelar preliminar contra Kalshi, impidiendo que la plataforma de mercados de predicción ofreciera sus servicios a los residentes en medio de lo que las autoridades calificaron de «apuestas deportivas [...] disfrazadas de oportunidad de inversión». En un aviso del miércoles, la fiscal general Dana Nesseldijoque el Tribunal de Circuito del 30.º Circuito Judicial del condado de Ingham aprobó una orden que impedía a Kalshi ofrecer contratos de eventos a los residentes del estado. La empresa podría recibir una multa de hasta 500.000 dólares al día por las infracciones. «Kalshi lleva mucho tiempo intentando hacerse pasar por una operación de juego legítima en nuestro estado, y me siento aliviada de que esta orden proteja aún más a los residentes de Michigan de sus prácticas depredadoras y sin licencia», declaró Nessel. Las medidas del tribunal de Michigan fueron las últimas de una serie de batallas legales entre empresas de mercados de predicción como Kalshi y Polymarket y las autoridades estatales de Estados Unidos. Nessel presentó la demanda contra Kalshi en marzo, alegando que la plataforma violó la legislación estatal sobre apuestas deportivas, una acusación formulada en muchas demandas similares en todo el país. Relacionado:Kalshi impone la primera prohibición de por vida a un político republicano por apuestas con información privilegiada Cabe destacar que la medida cautelar preliminar siguió a una orden de restricción dictada por un tribunal de Michigan en junio que prohibía a Kalshi ofrecer apuestas deportivas a los residentes. La Comisión de Negociación de Futuros de Productos Básicos de Estados Unidos (CFTC) ordenó a Kalshi no cumplir la orden estatal y continuar operando, una medida que la empresadescribió como algo que la colocabaen una «situación imposible». Cointelegraph se puso en contacto con Kalshi para solicitar comentarios, pero no recibió una respuesta inmediata. El mismo día que se dictó la orden del tribunal estatal de Michigan, las autoridades de Nueva Jersey anunciaron que habíanpresentado una petición de certiorariante el Tribunal Supremo de Estados Unidos por el caso del estado contra Kalshi. El caso, si los jueces aceptaran verlo, podría poner fin a las teorías jurídicas contrapuestas sobre si la CFTC o las autoridades estatales tienen jurisdicción sobre los mercados de predicción. «[S]ería razonable que el Tribunal Supremo lo aceptara, pero también podría esperar a que los casos se resolvieran sobre el fondo y no ocuparse simplemente de cuestiones procesales, como conceder o no una medida cautelar preliminar», declaró a Cointelegraph Melinda Roth, profesora visitante de práctica jurídica en New England Law, en Boston. «No obstante, sigo creyendo que el Tribunal Supremo abordará el asunto, ya sea a partir de la petición de certiorari de Nueva Jersey o poco después, dada la cantidad de litigios en curso en este ámbito». Roth añadió: Algunos legisladores estadounidenseshan propuesto legislaciónpara abordar el uso de información privilegiada por parte de clientes de Kalshi y Polymarket en contratos de eventos. En marzo, los senadores Adam Schiff y John Curtispresentaronun proyecto de ley para prohibir que las plataformas registradas ante la CFTC coticen cualquier contrato de eventos que «se parezca a una apuesta deportiva o a un juego de casino», remitiendo la jurisdicción a las autoridades de cada estado. Revista:¿El repunte de Bitcoin significa que no hemos desperdiciado nuestras vidas en las criptomonedas?

A Michigan court has ordered Kalshi to keep sports event contracts unavailable in the state under a preliminary injunction that carries fines of $500,000 per day for violations. - A Michigan court ordered Kalshi to continue blocking sports event contracts for residents under a preliminary injunction. - Kalshi could face fines of $500,000 per day for violating the court’s geofencing requirements. - Michigan sued Kalshi in March, alleging its sports contracts amounted to unlicensed sports betting. - The injunction replaces a temporary restraining order issued in June and will remain until a final ruling. - Kalshi faces similar legal challenges over sports contracts across multiple US states. The Michigan Attorney General’s Office said Wednesday that Ingham County Circuit Court Judge Rosemarie E. Aquilina signed the order on Sept. 1, extending restrictions that have applied to the prediction market platform since a temporary restraining order was issued in June. Under the injunction, Kalshi cannot offer, list, execute or settle sports-related contracts for people located in Michigan. The restrictions cover products functionally similar to internet sports betting, including moneyline markets, parlays, over-under contracts, in-game betting and proposition bets. Kalshi must use a third-party geolocation provider licensed by the Michigan Gaming Control Board and capable of meeting the regulator’s geofencing requirements. The court set a $500,000 daily fine for any day it finds the company failed to comply with those requirements. The injunction will remain in place until the court enters a final order in the case. Michigan court keeps Kalshi sports contracts blocked Michigan Attorney General Dana Nessel sued Kalshi in March on behalf of the state and in collaboration with the Michigan Gaming Control Board, alleging that the company violated the Michigan Lawful Sports Betting Act by offering sports event contracts without state approval. The complaint argues that Kalshi enables residents to engage in sports betting while presenting the transactions as event-contract trading. Michigan has maintained that the products fall within its gambling laws even though Kalshi operates as a federally regulated derivatives exchange. Nessel initially sought an order declaring the operation a common-law nuisance along with permanent injunctive relief preventing Kalshi from offering or advertising the products in Michigan. The legal fight moved between state and federal court after Kalshi attempted to remove the lawsuit to the U.S. District Court for the Western District of Michigan. The federal court granted Michigan’s request to remand the case, returning it to Ingham County Circuit Court. In late June, Aquilina granted a temporary restraining order that barred Kalshi from offering or facilitating sports event contracts in Michigan. As crypto.news previously reported, the original order imposed potential fines of $120,000 per day for noncompliance and required the company to meet state geolocation rules. The new preliminary injunction replaces the temporary order while the underlying lawsuit continues. “Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices,” Nessel said. Kalshi has faced conflicting Michigan orders The Michigan case previously created a separate dispute between state restrictions and federal derivatives oversight. After the state court ordered Kalshi to stop its Michigan sports operations, the Commodity Futures Trading Commission directed the exchange to continue operating its federally regulated market. The CFTC order involving Michigan came after Kalshi had begun unwinding sports event positions held by users in the state to comply with the court restrictions. Kalshi told the federal regulator that the Michigan order prevented it from continuing to accept trades from state residents. The company argued that following both directives placed it between conflicting state and federal requirements. The disagreement stems from Kalshi’s position that event contracts traded on its federally registered exchange fall under the Commodity Exchange Act and the CFTC’s exclusive jurisdiction. Michigan contends that sports-related products can still be regulated under its gambling laws when offered to people inside the state. Aquilina’s latest order requires Kalshi to provide copies of the injunction within three business days to futures commission merchants that make sports contracts processed through its exchange available to their customers. The order states that Kalshi will not be held responsible for an FCM’s customers when information about their locations remains in the possession of the intermediary and outside Kalshi’s control. State fights over Kalshi sports markets continue Michigan is one of more than a dozen states where regulators, attorneys general or other authorities have challenged prediction markets over sports contracts. The disputes have produced different results as courts consider whether federal derivatives law prevents states from applying their gambling rules. On Aug. 28, Kalshi lost its Nevada appeal after the Ninth Circuit upheld the state’s ability to apply gaming laws to its sports contracts. The ruling rejected Kalshi’s attempt to prevent Nevada from requiring state gaming approval. New Jersey has taken the opposite side of a split in the federal appeals courts to the U.S. Supreme Court. The state filed a petition seeking review after the Third Circuit found that federal law prevented New Jersey from regulating Kalshi’s sports event contracts under its gambling regime. Elsewhere, Connecticut opened another state-level front last week. Connecticut Attorney General William Tong, Department of Consumer Protection Commissioner Bryan T. Cafferelli and Gov. Ned Lamont sued Kalshi over sports contracts on Aug. 26, seeking an injunction to stop the company from offering the products without a state sports wagering license. Connecticut regulators had previously ordered Kalshi, Robinhood and Crypto.com to stop offering or promoting sports event contracts in December 2025. State officials raised concerns involving licensing, the state’s minimum sports betting age and consumer protections required of approved operators. Kalshi challenged that enforcement action in federal court, maintaining that its contracts are governed by federal commodities law. The CFTC later joined the jurisdictional fight by suing Connecticut and other states over attempts to regulate federally registered prediction markets. The regulator has argued that contracts listed on designated contract markets fall under the Commodity Exchange Act and cannot be prohibited by states simply because their outcomes involve sporting events. State authorities have continued pursuing their own cases. Baltimore sued Kalshi and Polymarket in August over alleged unlicensed sports betting, with its Kalshi complaint naming Coinbase, Robinhood and Webull over their distribution of sports event contracts. Kentucky filed similar lawsuits in June against Kalshi and Polymarket, while cases and enforcement actions have reached New York, Washington, Massachusetts and other jurisdictions. In Michigan, the Sept. 1 injunction leaves the restrictions in place while Nessel’s March lawsuit proceeds toward a final ruling.

New Jersey elevated the state battle against prediction markets to the United States Supreme Court on Tuesday, filing a writ of certiorari asking the high court to rule on how prediction markets should be regulated. The ruling comes months after the Third Circuit Court of Appeals held that the Commodity Exchange Act preempts state gambling laws, thereby giving a judicial victory to Kalshi, the prediction market provider that sued New Jersey. Over the past two years, different state and federal courts have addressed cases related to prediction markets, and their rulings are beginning to diverge from one another. “If the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 prevented states from regulating sports bets that occur within their jurisdictions when those bets are offered on markets registered with the Commodity Futures Trading Commission,” asks the top of New Jersey’s Petition for Certiorari. Prediction market providers “are not entitled to offer their sports bets without complying with the state-law,” New Jersey Attorney General Jennifer Davenport said in a statement. The Third Circuit Court of Appeals previously ruled in April that Kalshi’s offerings were subject to the federal Commodity Exchange Act, which in turn preeminent over New Jersey’s state gambling laws. The appellate panel, in a 2-1 decision, pointed to the CFTC, indicating that the regulator had not determined that Kalshi’s products related to sports were contrary to the public interest. The dissenting judge argued that the actual products on Kalshi’s platform were simply sports bets. However, last week, the Ninth Circuit Court of Appeals — a jurisdiction that includes states like Nevada — ruled that the CEA “likely does not preempt” state regulations for sports contracts, setting up a clash among circuit courts. Following the ruling, CFTC spokesman Zach Fulton told CoinDesk in an email that the decision “requires a ruling by the Supreme Court.” New Jersey’s petition for a writ of certiorari does not necessarily mean the Supreme Court will take the case. There are dozens of other cases in state and federal courts that address the same question, and the Court could choose to wait for some of these cases to begin resolving before weighing in on the matter.

New Jersey Attorney General and the state’s Acting Director of the Division of Gaming Enforcement have officially filed a petition with the U.S. Supreme Court to review a case aimed at resolving whether state authorities or federal agencies have jurisdiction over prediction market companies. On Wednesday, Attorney General Jennifer Davenport and Acting Director of Gaming Enforcement Mary Jo Flaherty filed a petition for a writ of mandamus with the U.S. Supreme Court regarding New Jersey’s measures against the prediction-market platform Kalshi for its contracts on sporting events. The officials cited civil cases brought by gaming authorities in “at least 20 states” and asked the Supreme Court to determine whether prediction-market companies could comply with the Commodity Futures Trading Commission (CFTC) while violating state laws. “Companies like Kalshi claim to offer legal sports betting in all 50 states, but refuse to comply with the gaming laws of any state,” Davenport said. “These companies have no right to offer their sports wagers without complying with state law, so dozens of states across the ideological spectrum have opposed them [...] We ask the Supreme Court to resolve this matter and recognize that Congress did not implicitly exempt the sports betting industry from state law.” Source: New Jersey Attorney General. Citing New Jersey’s enforcement actions against Kalshi, the petition raised to the Supreme Court the question of “whether the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 prevents states from regulating sports bets conducted within their jurisdictions if those bets are offered on markets registered with the [CFTC].” Cointelegraph contacted the CFTC for comment but did not receive an immediate response. The petition challenges a U.S. Court of Appeals for the Third Circuit opinion from April, in which the judges ruled 2-1 against the New Jersey gaming authorities, stating, according to Kalshi’s argument, that the company had a “reasonable probability of success” in contending that the CFTC’s Commodities Exchange Act prevailed over state law. The petition specifically challenged the CFTC’s assertion that sports betting on prediction-market platforms constitutes “swaps” under the agency’s jurisdiction and stated: “federal law does not prevail over state sports betting laws in any case.” What could be the consequences for Kalshi and other prediction markets? “Since federal law prohibits trading swaps outside CFTC-registered markets, a victory for Kalshi would mean that all sports bets made outside those CFTC-registered markets would apparently become illegal, even if state law allows them,” the New Jersey attorney general’s office said in the petition. Kalshi spokeswoman Dani Lever told Cointelegraph that the company did not agree with New Jersey’s decision to appeal to the Supreme Court and asserted that it could not be “regulated by 50 different regulators.” “We remain confident in the decisions of the lower courts, and nothing presented today by New Jersey changes our view,” Lever said. A contract about when the U.S. Supreme Court will hear a prediction-market case. Source: Polymarket. It is not clear whether Supreme Court justices will address the issue of prediction markets. Many experts have speculated that justices could weigh in on a case that reached the Nevada Court of Appeals. Whether the court chooses Kalshi’s case in Nevada, the New Jersey case, or a forthcoming enforcement action against another company, any possible decision could determine which authorities can regulate prediction markets.

Skip to content LATEST NEWS New Jersey asks the Supreme Court to rule that states can regulate prediction markets hace 23 hours Regulation Warren Buffett and Berkshire Hathaway's new CEO choose Alphabet to win the race in AI development September 2, 2026 Business Wonderful AI startup raises $550 million, doubling its valuation to $5 billion in six months September 2, 2026 Technology How a space war between the United States and China would begin, and who would control the strategic orbital position September 2, 2026 Technology SELECTED FOR YOU Thailand's SEC ends cryptocurrency travel regulation, which will take effect in February 2027 September 2, 2026 Regulation The rise of crypto sports sponsorship runs into a hurdle: the UK freezes a $13.5 million payment to Sorare September 1, 2026 Regulation SEC scrutiny of SPVs pre-IPO highlights AI companies driving the private market surge Regulation September 1, 2026 New Jersey asks the Supreme Court to rule that states can regulate prediction markets like Kalshi as gambling By!Hannah Collymore Hannah Collymore 3 minutes read Published 23 hours ago !New Jersey asks the Supreme Court to rule that states can regulate prediction markets New Jersey has asked the Supreme Court to rule that states can regulate prediction markets like Kalshi and Polymarket as gambling. The dispute has lasted two years and, for the first time, reaches the hands of Supreme Court justices. The petition was filed on Wednesday, and a ruling by the high court would resolve whether this multimillion-dollar industry will be regulated by state gaming regulators or a single federal agency. Davenport wants Congress to interpret the law restrictively, not the CFTC The plaintiffs ask the justices to reverse a Third Circuit Philadelphia-based court’s decision, which held that the Commodity Futures Trading Commission (CFTC) has jurisdiction over Kalshi and Polymarket, nullifying New Jersey's gaming laws. Jennifer Davenport, state attorney general and a member of the Democratic Party, states that the case is simply about reining in the federal government's overreach. “We urge the Supreme Court to resolve this matter and recognize that Congress did not implicitly exempt the sports betting industry from state legislation,” a spokesperson said. In the filed documentation, her office argues that the Commodity Exchange Act did not authorize the CFTC to act as “the sole regulator of sports betting in this country,” and adds that health and safety matters have always fallen under state jurisdiction. A split opinion among circuit judges that may be hard to overlook New Jersey has chosen the perfect moment to bring this lawsuit. Its petition comes just a week after the Ninth Circuit’s unanimous ruling allowing states to regulate prediction markets as sports bets, siding with Nevada. The Ninth Circuit’s view diverges from the Third Circuit’s, which held that Kalshi’s “fact-tracking events” are legally different from sports books and should be under federal supervision. The core issue has divided the two courts of appeals, and legal experts say this discrepancy warrants Supreme Court intervention. It is likely the justices will decide this fall whether to hear the case, and if so, a ruling is expected next summer. Kalshi is the country’s most popular prediction site and is also referenced in New Jersey’s lawsuit. The company says it expects to win the case. “Kalshi is a national open financial exchange. It cannot be regulated by 50 different regulatory bodies,” spokesperson Dani Lever said. Casinos, tribes, and 44 states unite against the platforms The opposition is broad and spans both political parties. A coalition of 44 states has described prediction sites as unlicensed sports books that circumvent consumer protection and tax obligations governing traditional bets. Native American tribes and industry pioneers have allied with the states. Operators like FanDuel and DraftKings view prediction sites as competitors seeking shortcuts. Currently, three states (Nevada, Michigan, and Washington) have obtained court orders suspending Kalshi’s sports-trades. Sports betting is the business’s backbone and accounts for more than 80% of weekly volume. Why bets keep rising The money at stake has increased and time spent has rapidly grown. Cryptopolitan reported that total prediction market volume surged to $38.5 billion from $2 billion in August 2025, a 1,900% increase. Kalshi allows deposits and withdrawals in cryptocurrency, and Polymarket focuses on stablecoin guarantees on the blockchain, so a state-by-state shutdown would affect crypto markets. CFTC chairman Mike Selig, appointed by Trump, says his agency has exclusive jurisdiction over prediction markets and has driven their growth. This creates a conflict between the federal government and dozens of states. Don’t just read news about cryptocurrencies. Understand them. Subscribe to our newsletter. It’s free. Frequently Asked Questions This is about whether states can regulate Kalshi-like prediction-market platforms as sports betting, or if the federal CFTC has exclusive authority under the Commodity Exchange Act. Two federal appellate courts have issued divergent rulings: the Third Circuit ruled in April that the CFTC has priority over state law, while the Ninth Circuit ruled last week that states can regulate platforms as sports betting, and NPR legal experts said this discrepancy makes a review likely. Nevada, Michigan, and Washington regulators have obtained court orders prohibiting, at minimum, Kalshi sports betting. Kalshi’s CFTC multi-purpose market Share this article Legal notice. The information provided does not constitute investment advice. Cryptopolitan consult does not take responsibility for investments based on the information on this page. We strongly recommend independent research or consulting a qualified professional before making any investment decision. !Hannah Collymore Hannah Collymore Hannah is a writer and editor with nearly a decade of experience in blogging and reporting on cryptocurrency events. At Cryptopolitan, she contributes to the news section, reporting and analyzing the latest developments in DeFi, RWA, cryptocurrency regulation, AI, and cutting-edge technologies. She holds an MBA from Arcadia University. INDEX 1. Davenport wants Congress to interpret the law strictly, not the CFTC 2. A split among circuit judges that may be hard to overlook 3. Casinos, tribes, and 44 states unite against platforms 4. Why bets keep rising Share this article MORE… NEWS SHOW ALL !chat gpt 5 clever ChatGPT applications and what you should do about them Three years ago, technician John Palmer !AI-powered solutions 97% of business leaders prefer AI-based solutions for sustainability management of the brand, according to Reuters Three years ago, technician John Palmer !The France AI ecosystem This is how Macron supports France’s vibrant and productive AI ecosystem Three years ago Tech Glory Kaburu !Generative AI Bloomberg estimates the generative AI market will reach $1.3 trillion by 2032 Three years ago, Tech Aamir Sheikh What is Base? The Ethereum layer-2 network launched by Coinbase October 21, 2025 Learn about cryptocurrencies: Guides for beginners Dogecoin vs. Bitcoin: Key technical differences October 20, 2025 Learn about cryptocurrencies: Guides for beginners What is TVL (Total Value Locked) in cryptocurrencies? 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What Does Michigan’s Injunction Require From Kalshi? A Michigan state court has issued a preliminary injunction requiring prediction market operator Kalshi to continue blocking state residents from accessing sports-related event contracts, extending a legal restriction that had been in place since June. Ingham County Circuit Court Judge Rosemarie E. Aquilina issued the order on Tuesday. The injunction will remain in effect until the court reaches a final decision in Michigan’s case against the company. Kalshi must use a third-party geolocation provider licensed by Michigan’s gaming regulator and comply with state geofencing requirements. Failure to follow the order could expose the company to fines of $500,000 for each day of non-compliance. The preliminary injunction replaces an earlier temporary restraining order issued in June, giving Michigan a longer-lasting restriction while the underlying dispute proceeds through state court. The size of the potential daily penalty raises the financial cost of testing the boundaries of the order. It also makes geolocation controls increasingly important for Kalshi as state regulators seek to prevent residents from accessing contracts they consider unauthorized sports wagering. Why Is Michigan Challenging Kalshi’s Sports Contracts? Michigan sued Kalshi in March, alleging that the company violated state sports betting laws by allowing residents to wager on sporting outcomes through products structured as event contracts. Kalshi operates as a federally regulated derivatives exchange and has argued in disputes around the country that its event contracts fall under federal commodities law rather than state gambling regimes. State officials have taken the opposite view when contracts allow users to take positions on the outcomes of sporting events. That distinction sits at the center of a growing legal fight over prediction markets. If sports event contracts are treated primarily as federally regulated derivatives, platforms such as Kalshi could potentially offer them nationally under one regulatory framework. If courts allow states to regulate them as sports betting products, operators could face a patchwork of licensing rules, geofencing requirements and outright prohibitions. Kalshi previously attempted to move Michigan’s case into federal court. The U.S. District Court for the Western District of Michigan granted the state’s request to send the lawsuit back to state court, where the preliminary injunction has now been imposed. Investor Takeaway How Large Is Kalshi’s Nationwide Legal Fight? Michigan is one of a growing number of states where Kalshi has faced enforcement action, litigation or other regulatory challenges connected to sports-related prediction contracts. Connecticut sued Kalshi last week seeking to block sports contracts, adding another case to a widening dispute between prediction market operators and state gaming authorities. The cases could produce different outcomes because courts are being asked to interpret the relationship between federal commodities regulation and state gambling laws. That creates the possibility that Kalshi could be permitted to offer a product in one jurisdiction while being required to block it in another. Such fragmentation would add compliance costs. Prediction market operators may need more sophisticated geolocation systems, jurisdiction-specific product controls and legal teams capable of managing parallel cases across several states. Michigan Attorney General Dana Nessel welcomed the injunction and said the order would further restrict what the state considers unlicensed gambling activity. Kalshi had not publicly responded to the order at the time of writing. Can Legal Pressure Slow Kalshi’s Growth? The regulatory disputes have so far not prevented Kalshi from building substantial trading volume. The platform recorded about $38.67 billion in volume during August, compared with roughly $8.41 billion combined across Polymarket and Polymarket US, according to The Block’s data dashboard. That gap shows why the sports-contract fight matters commercially. Sports markets can attract frequent trading around major leagues and events, making them valuable for user acquisition, liquidity and transaction revenue. However, rising trading volume does not remove the legal risk. If more states obtain injunctions similar to Michigan’s, Kalshi could retain federal regulatory status while losing access to users in important state markets. The next stage of the Michigan case will therefore matter beyond the state itself. A final ruling supporting Michigan could strengthen arguments from other gaming regulators seeking to apply state betting laws to prediction markets, while a ruling favoring Kalshi could reinforce the company’s claim that federal derivatives regulation limits state authority over its contracts.

NJ Attorney General Jennifer Davenport petitioned SCOTUS to settle whether Kalshi's sports event contracts count as illegal betting. This post is AI-assisted writing. Mistakes can happen. If you spot an error, pleaselet us know. New Jersey Attorney General Jennifer Davenport asked the U.S. Supreme Court on Wednesday to decide whether Kalshi and similar prediction market platforms can legally offer sports event contracts to customers nationwide. The filing marks the furthest any state has pushed the fight over these products toward the country’s highest court. Davenport’s office wants the justices to settle a question that has split lower courts for months: does federal oversight of Kalshi through the Commodity Futures Trading Commission shield its sports contracts from state gambling law? New Jersey has argued that Kalshi’s sports products function like sportsbook wagers and should fall under state licensing rules the same way a DraftKings or FanDuel bet does. Kalshi and other prediction market operators have countered that their contracts are federally regulated derivatives, not bets, and that the CFTC’s jurisdiction preempts individual states from blocking them. That argument has won some rounds in court and lost others, which is precisely why New Jersey now wants a single, binding answer from Washington. This petition doesn’t come out of nowhere. A Ninth Circuit panel ruled 3-0 against sports event contracts in a setback for Kalshi’s side of the argument, and that decision helped set up the current split among appellate courts. When circuit courts disagree on the same federal question, that’s usually the exact scenario the Supreme Court exists to resolve. New Jersey isn’t alone in pressing the issue. States including Nevada have separately challenged Kalshi’s regulatory framing, arguing that letting a CFTC-licensed platform offer sports contracts without state sportsbook licensing undercuts decades of state-by-state gambling law. Whether the Supreme Court agrees to hear the case at all is its own open question. The justices could decline and let the Ninth Circuit’s ruling stand as the law in that region alone. None of this changes anything for Oregon Lottery customers today. The Lottery’s sportsbook, Scoreboard, still doesn’t take wagers on college sports, and Kalshi’s contracts operate through a separate federal framework that hasn’t been tested in Oregon courts. For readers under 21, or anyone tempted to treat prediction markets as a shortcut around state betting rules, we’d treat this the way we’d treat any unsettled legal question: wait for the ruling before assuming the product is safe or sanctioned. A Supreme Court decision on whether to even take the case could take months. Until then, Kalshi keeps operating under the CFTC’s umbrella in states that haven’t shut it down by court order. Related:Ninth Circuit Panel Rules 3-0 Against Sports Event Contracts in Major Setback

New Jersey Attorney General Jennifer Davenport has asked the U.S. Supreme Court to weigh in on whether federally regulated prediction markets can offer sports wagers without following state sports-gambling laws. Litigation on this issue has arisen across at least 20 states with dozens of active suits pending and the gambling laws of several states currently enjoined by federal courts. On Wednesday, Davenport filed a petition with the U.S. Supreme Court seeking its review of the legality of the business model of offering sports wagers self-certified by Kalshi with the Commodity Futures Trading Commission (CFTC) without following state laws. Kalshi is the first federally regulated financial exchange and prediction market in the United States where users trade on the outcomes of real-world future events, including sports. “Companies like Kalshi claim to offer legal sports betting in all 50 States, but they refuse to follow the gambling laws of any state,” Davenport said in a statement on Wednesday. “These companies have no right to offer their sports bets without following state law, which is why dozens of States across the ideological spectrum have opposed them.” Davenport noted that states have adopted careful laws to regulate gambling, including to prevent compulsive gambling, gambling by minors, and insider trading on sports games. “We’re calling on the Supreme Court to resolve this issue and recognize that Congress did not silently make the sports-betting industry immune from state law,” Davenport said. “Kalshi markets itself as the ‘first app for legal sports betting in all 50 States,’ including for wagering on NCAA games held in New Jersey and participated in by New Jersey teams, which is impermissible under New Jersey’s Constitution,” said Division of Gaming Enforcement interim Director Mary Jo Flaherty in a statement Wednesday. “But Kalshi does not abide in any way with our state’s gaming laws,” Flaherty said. “This is a states’ rights issue. In New Jersey, gaming is prohibited by its Constitution, other than for exceptions approved by New Jersey voters. In this case, the state is upholding the will of New Jerseyans regarding the manner in which gaming can be conducted.” The stakes are exceptionally high. In 2025, legalized sports betting generated $16.89 billion in revenue for states nationwide, not even including sportsbooks in tribal casinos. Indeed, 95% of Kalshi’s revenue in 2025 came from sports betting. At issue in this case is whether the States can still regulate this major economic industry, or whether the sole regulatory body for companies like Kalshi is the CFTC, which has admitted that it is not a gaming regulator and has no specialized expertise in overseeing gaming, Davenport said. That is why 44 states, hundreds of tribes, and casinos have all already weighed in to oppose Kalshi’s and the other prediction markets’ litigation theories. At issue is whether Congress, by enacting the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, intended to federalize a multi-billion-dollar sports-wagering industry. Kalshi claims that it did. In 2025, the company sued New Jersey, claiming that it could offer sports gambling in the state without following New Jersey’s rigorous gambling laws because its sports wagers are actually “swaps” that can only be regulated by the CFTC. In April 2026, the 3rd U.S. Circuit Court of Appeals, by a 2-1 vote, ruled in Kalshi’s favor, holding that New Jersey’s state gambling laws are preempted. The vast majority of federal and state courts around the country have disagreed and instead overwhelmingly rejected the argument that such sports bets have a loophole from state law. The latest win for the states came Aug. 28, when the 9th U.S. Circuit Court of Appeals explicitly disagreed with the 3rd Circuit and ruled that sports bets on outcomes of a sporting event do not fall within the exclusive jurisdiction of the CFTC. New Jersey co-led an amicus brief in that case, joined by 39 other jurisdictions. The 9th Circuit cited that amicus brief in holding “it is implausible that Congress intended to allow the CFTC to engage in the national regulation of gambling based on expansive definitions of the words ‘event’ and ‘associated with’ in a Wall Street reform bill.” The petition also emphasizes the consequences of a ruling in Kalshi’s favor. Because federal law prohibits trading swaps off CFTC-registered markets, a victory for Kalshi would mean that all sports gambling off such CFTC-registered markets would seemingly become illegal even if state law allows it. Such an outcome would make sports wagers at classic sportsbooks like brick-and-mortar casinos — whether in Atlantic City, Las Vegas, or on tribal lands — illegal, and throw the entire industry into turmoil. This is not New Jersey’s first time seeking review on a critical state gaming issue. Eight years ago, the U.S. Supreme Court ruled for New Jersey in Murphy v. NCAA, explaining that if Congress elects not to “regulate sports gambling directly,” then “each state is free to act on its own.” Kalshi’s model, which offers sports bets in all 50 states, would upend the promise that each state could decide whether to allow sports wagering within its borders.

New Jersey asks Supreme Court to resolve fight over Kalshi's future The multibillion dollar battle over the future of prediction markets has reached the Supreme Court. New Jersey on Wednesday asked the high court to weigh in on a legal battle that has pitted dozens of states against the prediction market sector, which is strongly backed by the Trump administration. At issue is who exactly should regulate sports betting on the prediction market platform Kalshi: federal commodities regulators, as the company insists, or state gambling authorities? While prediction market sites like Kalshi offer wagering on everything from what an executive says on an earnings call to the outcome of an election, sports bets are the most popular by far, typically representing 80% or more of the platforms' weekly trading volume. The request from New Jersey officials follows split decisions by federal appeals courts. In April, the Third Circuit found that the Commodity Futures Trading Commission has the exclusive right to oversee the prediction market sector in a case brought by Kalshi against New Jersey. But last week, the Ninth Circuit issued the opposite opinion in a case involving Nevada, ruling that states, not the federal government, should regulate the booming industry. In its petition to the high court, lawyers for the New Jersey Attorney General's Office argued that the law at issue, the Commodity Exchange Act, does not allow prediction market operators to ignore state law. "States have always maintained the primary police powers for health and safety matters, including for gambling," the attorneys wrote. "Nothing in the Act gives the CFTC unprecedented authority to become the sole regulator of sports gambling in this country, much less gives companies a get-out-of-50-state-laws-free pass by self-certifying their bets on a CFTC-registered market." In response, Kalshi said federal regulations covering financial investments apply to its markets and override state laws. "Kalshi is an open, nationwide financial exchange. It cannot be regulated by 50 different regulators," said Kalshi spokeswoman Dani Lever. "We remain confident in the lower courts' rulings, and nothing in New Jersey's filing today changes our view." State-regulated sports betting services, like FanDuel and DraftKings, which are subject to billions of dollars in state taxes, have been among the prediction market industry's antagonists, viewing the insurgent sites as fast-growing rivals that are cutting corners. If the Supreme Court accepts New Jersey's petition, arguments could be scheduled this fall, with the case expected to be decided by next summer.

A petition aims to allow states to classify platforms like Kalshi and Polymarket as gambling under local laws. The gist New Jersey filed on Wednesday a motion with the United States Supreme Court to allow states to classify prediction markets, such as Kalshi and Polymarket, as gambling. The dispute has already dragged on for two years and, for the first time, reaches the judges of the nation’s highest court. The petition seeks to overturn a Third Circuit decision in Philadelphia, which held that the CFTC has exclusive authority to regulate platforms like Kalshi and Polymarket, above New Jersey’s betting laws. In the filing, the state contends that federal law did not make the agency the sole regulator of this market. New Jersey’s offensive came shortly after a unanimous decision of the Ninth Circuit favorable to the position of Nevada, authorizing states to regulate prediction markets as sports bets. Thus, the issue began to divide different appellate courts, a context that could prompt the Supreme Court to review the case. According to a coalition of 44 states, these platforms have been described as unlicensed betting houses that evade consumer protection rules and the tax obligations applicable to the traditional sector. Indigenous tribes as well as operators like FanDuel and DraftKings also opposed this model. Kalshi, cited in the filing, said it expects to prevail in the dispute and defended the fact that it operates as a national financial exchange. Currently, Nevada, Michigan, and Washington have already obtained court orders to suspend the platform’s sports betting contracts. The debate also touches the crypto market. The document notes that Kalshi allows crypto deposits and withdrawals, while Polymarket uses on-chain stablecoin-backed guarantees, which would amplify the effects of a potential state-by-state paralysis. About the author See full profile A Redação PortalCripto is the editorial team responsible for daily coverage of the crypto assets market on PortalCripto. We bring together writers and editors dedicated to explaining Bitcoin, altcoins, regulation, and trends in a clear, verified, and accessible way for readers of all levels.

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Sept 2 (Reuters) - New Jersey authorities on Wednesday asked the U.S. Supreme Court to resolve whether states have the power to police sports betting that occurs on prediction markets operated by Kalshi and competing platforms. The state asked the Supreme Court to overturn an appellate court's decision in April holding that the U.S. Commodity Futures Trading Commission has exclusive jurisdiction over the sports-related event contracts that Kalshi allows people to trade on its platform. Sign up here. "These companies have no right to offer their sports bets without following state law, which is why dozens of states across the ideological spectrum have opposed them," New Jersey Attorney General Jennifer Davenport, a Democrat, said in a statement. New York-based Kalshi did not immediately respond to a request for comment. Kalshi, which in a recent funding round was valued at $22 billion, has been at the center of an escalating legal battle over the ability of state gaming regulators to police companies in the fast-growing prediction markets industry. States argue that firms like Kalshi are operating without required state licenses, in violation of gaming laws, including bans on wagers by those under 21. Under Republican President Donald Trump's administration, the CFTC has shared the companies' position that trading on prediction markets falls exclusively under the agency's jurisdiction. Davenport is asking the Supreme Court to overturn a 2-1 decision by the Philadelphia-based 3rd U.S. Circuit Court of Appeals in Kalshi's favor that concluded that the federal Commodity Exchange Act likely preempted New Jersey's laws. New Jersey took its case to the nation's highest court just days after a different federal appeals court sided against Kalshi , ruling that Nevada gaming regulators could not be blocked from requiring the company to hold a gaming license to allow users to bet on sports outcomes. Those conflicting appellate court rulings increased the possibility that the Supreme Court could be forced to step in and resolve the issue, which is at the center of numerous other court cases nationwide. At least four states — Nevada, Massachusetts , Michigan and Washington — have won court orders restricting Kalshi's activities. New Jersey argues the 3rd Circuit's holding rests on the incorrect premise that Congress, in adopting the Dodd-Frank Act following the 2008 financial crisis, silently shifted authority over sports wagering away from states to the CFTC when it was directed to regulate "swaps," a type of derivative contract. "At the very least, Dodd-Frank is not nearly clear enough to transfer authority over a multi-billion-dollar sportsgaming industry to a federal regulatory agency with no gambling expertise," the state's lawyers wrote. Reporting by Nate Raymond in Boston Editing by Nick Zieminski Our Standards: The Thomson Reuters Trust Principles.

Discover the institutional crypto exchange LMAX Digital through high-level info and live data here. ✕ Latest Crypto News SoFi, Payward agree to link banking network with Kraken infrastructure Sep 03, 2026, 8:52AM EDT • Business Bitcoin-gold correlation hits six-year high, but analysts question whether equity decoupling will last Sep 03, 2026, 7:01AM EDT • Markets 'Much ado about nothing': CFTC files to dismiss CME's lawsuit over crypto perpetual futures Sep 02, 2026, 11:39PM EDT • Regulation Anthony Armstrong, former CFO at Elon Musk's xAI and X, joins Coinbase board Sep 02, 2026, 5:03PM EDT • Business See More Latest Crypto News Michigan court orders Kalshi to keep blocking sports prediction markets By Timmy Shen • Edited by Regulation•September 3, 2026, 12:30AM EDT UPDATED: September 3, 2026, 12:33AM EDT Share !Michigan court orders Kalshi to keep blocking sports prediction markets <span class="acf-media-credit"><span class="acf-credit"><span class="acf-credit"><a href="theblock.co" target="_blank">The Block</a></span></span></span> Quick Take A Michigan state court has issued a preliminary injunction requiring Kalshi to continue blocking state residents from accessing sports-related event contracts. The injunction converts a temporary restraining order issued in June, and violations would result in a fine of $500,000 per day. Advertisement A Michigan state court has issued a preliminary injunction requiring Kalshi to continue blocking state residents from accessing sports-related event contracts. Ingham County Circuit Court Judge Rosemarie E. Aquilina issued the The injunction requires the prediction markets platform to use a third-party geolocation services provider licensed by the state's gaming regulator to comply with geofencing specifications. Violations would result in a fine of $500,000 per day, according to the filing. The Michigan state filed the lawsuit against Kalshi in March, arguing that the company violated the state's sports betting law by enabling Michigan residents to "engage in sports betting under the guise of trading event contracts." The preliminary injunction converted an earlier temporary restraining order issued in June. Kalshi had attempted to move the case to the federal level, but the Western District of Michigan court granted the state's motion to remand the lawsuit back to the state court. "Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices,” Nessel said in the Wednesday statement. The Block has reached out to Kalshi for comment. Nationwide fight Kalshi continues to face legal challenges from state-level authorities, with more than a dozen states taking enforcement action or filing lawsuits against the prediction markets platform. Last week, Connecticut sued Kalshi to block the platform from offering sports contracts, escalating the state's months-long legal fight against the platform. Despite the mounting legal pressure, Kalshi remains the dominant player in the prediction markets sector. It recorded $38.67 billion in trading volume in August, compared with a combined $8.41 billion on Polymarket and Polymarket US, according to The Block's data dashboard. Polymarket, Polymarket US and Kalshi Monthly Volume (The Block) Disclaimer: The Block is an independent media outlet that delivers news, research, and data. As of November 2023, Foresight Ventures is a majority investor of The Block. Foresight Ventures invests in financial disclosures. © 2026 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice. RATINGS See more ratings SPONSORED TRON Founder Justin Sun Shares Outlook on Bitcoin, Stablecoins and Global Finance at Bitcoin Asia 2026 August 31, 2026, 5:58PM EDT

Editor’s note: The gambling news roundup will return tomorrow. Next stop for prediction markets: The Supreme Court? New Jersey’s attorney general filed a petition with the US Supreme Court on Wednesday in its case vs. Kalshi. At stake: Whether Kalshi can offer sports event contracts nationwide under federal law, or whether state gambling laws can still apply. The backstory: New Jersey was one of the first states to send a cease-and-desist letter to Kalshi in 2025, alleging that it was offering sports betting illegally in the state. Kalshi in turn sued the state, seeking a preliminary injunction to stop New Jersey from enforcing its gambling laws against the company. A federal district court granted Kalshi the preliminary injunction, and the Third Circuit Court of Appeals affirmed that decision in April. Things got more interesting on Friday, when Nevada won a similar case against Kalshi in the Ninth Circuit. The court held that sports event contracts are not “swaps” under federal commodities law, directly conflicting with the Third Circuit’s reasoning and creating a circuit split. Circuit splits are one of the factors that can make Supreme Court review more likely, although the nation’s highest court hears only a small percentage of the petitions it receives. New Jersey faced a Thursday deadline to petition SCOTUS. Sponsor’s message Trusted Voices: Conversations About Betting is designed to equip adults, including parents and coaches, with tools and resources to talk to young people about gambling, including information on warning signs, risks and proxy betting. The program is led by retired professional basketball player Randy Livingston and his wife, basketball agent Anita Smith, who share their personal stories related to problem gambling, with the hope of preventing others from experiencing similar harms. Learn more and join the conversation here. More from NJ Attorney General Jennifer Davenport in a press release today: “Litigation regarding these questions has erupted across at least 20 states, with dozens of active suits pending and the gambling laws of several states currently enjoined by the federal courts. This is the first certiorari petition filed with the U.S. Supreme Court regarding the legality of this business model — of offering sports wagers self-certified by Kalshi with the Commodity Futures Trading Commission (CFTC) without following state laws. “Companies like Kalshi claim to offer legal sports betting in all 50 States, but they refuse to follow the gambling laws of any State,” said Attorney General Davenport. “These companies have no right to offer their sports bets without following state law, which is why dozens of States across the ideological spectrum have opposed them. States have long adopted careful laws to regulate gambling, including to prevent compulsive gambling, gambling by minors, and insider trading on sports games. We’re calling on the Supreme Court to resolve this issue and recognize that Congress did not silently make the sports-betting industry immune from state law.” “Kalshi markets itself as the ‘first app for legal sports betting in all 50 States,’ including for wagering on NCAA games held in New Jersey and participated in by New Jersey teams, which is impermissible under New Jersey’s Constitution. But Kalshi does not abide in any way with our State’s gaming laws,” said Division of Gaming Enforcement Interim Director Mary Jo Flaherty. “This is a states’ rights issue. In New Jersey, gaming is prohibited by its Constitution, other than for exceptions approved by New Jersey voters. In this case, the State is upholding the will of New Jerseyans regarding the manner in which gaming can be conducted.” The stakes of this case are exceptionally high. In 2025, sports betting generated $16.89 billion in revenue for States nationwide, not even including sportsbooks in tribal casinos. Indeed, 95% of Kalshi’s revenue in 2025 came from sports betting. At issue in this case is whether the States can still regulate this major economic industry, or whether the sole regulatory body for companies like Kalshi is the CFTC, which has admitted that it is not a gaming regulator and has no specialized expertise in overseeing gaming. That is why 44 States, hundreds of Tribes, and casinos have all already weighed in to oppose Kalshi’s and the other prediction markets’ litigation theories. The particular issue is whether Congress in enacting the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act intended to federalize a multi-billion-dollar sports-wagering industry. Kalshi claims that it did, so in 2025, the company sued New Jersey, claiming that it could offer sports gambling in the State without following New Jersey’s rigorous gambling laws because its sports wagers are actually “swaps” that can only be regulated by the CFTC. In April 2026, the Third Circuit, by a 2-1 vote, ruled in Kalshi’s favor, holding that New Jersey’s state gambling laws are preempted. The vast majority of federal and state courts around the country have disagreed and instead overwhelmingly rejected the argument that such sports bets have a loophole from state law. The latest win for the States came Friday, August 28, when the Ninth Circuit explicitly disagreed with the Third Circuit and that sports bets on outcomes of a sporting event do not fall within the exclusive jurisdiction of the CFTC. The Ninth Circuit concluded that “Congress did not take a wrecking ball to all sports gambling regulations built up over decades by federal, state, and tribal governments” in a 2010 Wall Street reform bill. New Jersey co-led an amicus brief in that case, joined by 39 other jurisdictions. The Ninth Circuit cited that amicus brief in holding “it is implausible that Congress intended to allow the CFTC to engage in the national regulation of gambling based on expansive definitions of the words ‘event’ and ‘associated with’ in a Wall Street reform bill.” The petition also emphasizes the consequences of a ruling in Kalshi’s favor. Because federal law prohibits trading swaps off CFTC-registered markets, a victory for Kalshi would mean that all sports gambling off such CFTC-registered markets would seemingly become illegal even if state law allows it. Such an outcome would make sports wagers at classic sportsbooks like brick-and-mortar casinos — whether in Atlantic City, Las Vegas, or on tribal lands — illegal, and throw the entire industry into turmoil. States’ gambling laws exist to protect minors, mitigate problem gambling, prevent insider trading, and ensure operators have the financial stability to pay out winnings. If companies like Kalshi can bypass these laws simply by registering with the CFTC, these protections evaporate. For that reason, attorneys general across the country have cautioned that unregulated sports gambling poses serious risks to public health and financial security for millions of Americans. This is not New Jersey’s first time seeking review on a critical state gaming issue. Eight years ago, the Supreme Court ruled for New Jersey in Murphy v. NCAA, explaining that if Congress elects not to “regulate sports gambling directly,” then “each state is free to act on its own.” Kalshi’s model, which offers sports bets in all 50 States, would upend the promise that each state could decide whether to allow sports wagering within its borders. This petition to the U.S. Supreme Court is led by Solicitor General Jeremy Feigenbaum, Deputy Solicitor General Stephen Ehrlich, and Special Assistant Liza Fleming, with support from Deputy Attorneys General Emily Bisnauth, Patrick Jhoo, and Vivek Mehta. Sponsor’s message: For iGaming companies, protecting customer privacy is paramount: Nicole Kardell acts as their guardian against federal, state and civil actions that could damage their reputations and profitability. Nicole performs on the leading edge of privacy law, helping to keep Ifrah’s clients in compliance with U.S. and international regulations governing the handling of customers’ confidential information. A certified privacy professional with expertise in European privacy law (CIPP/E), Nicole works with iGaming operators and other industry participants to navigate the complex challenge of keeping players safe. You can also see the petition here. Some highlights: The Third Circuit’s profoundly important decision is also profoundly wrong. Kalshi argues that in granting the CFTC “exclusive jurisdiction” over “swaps” on CFTC-registered markets, Congress in 2010 actually preempted sports-wagering laws applied to these bets. But as the Ninth Circuit has since explained, these sports bets are not “swaps” as the statutory text and structure uses that term. And it strains credulity to hold that Congress in resolving the 2008 financial crisis took steps to federalize regulation of sports gambling that was otherwise explicitly addressed across other federal statutes spanning decades. This petition presents an ideal vehicle for resolving the important question whether States are prevented from regulating sports gambling merely because that gambling happens on a CFTC-registered market. This issue has led to an explosion of litigation in the lower courts and spawned immediate disagreement on this major question, including a direct, acknowledged, and irreconcilable split between the Third and Ninth Circuits. The issue is one of tremendous practical and legal consequence: Kalshi seeks to federalize the multi-billion-dollar sports betting industry at the expense of every state sports gaming law. And the decision below is badly mistaken. Certiorari is urgently needed. The practical importance of this dispute goes to the heart of the States’ police power, posing a fundamental threat to the over 150-year-long tradition of state gaming regulation. For over a century, this Court has recognized that regulation of gaming lies “within the police powers of a state.” Moreover, the case is important not just practically but jurisprudentially, as the opinion below raises serious issues for the operation of other laws. The Indian Gaming Regulatory Act, for example, gives Tribes the “exclusive right to regulate gaming activity on Indian lands” so long as the State where those lands sit permits gaming. 25 U.S.C. §2701(5). And the Wire Act makes it a crime to use interstate wire communication facilities, including the internet, to facilitate bets on “any sporting event,” except if the wagers are legal in the sending and receiving States. 18 U.S.C. §1084(a). Also…I am in there! Next up: The waiting game. New Jersey, Kalshi, and everyone will wait to see if the Supreme Court will review the case, which could set up oral arguments and a decision in 2027. It’s also possible SCOTUS could wait until some of the other sports-event-contract cases are further along. The federal appellate rulings so far have come at the preliminary-injunction stage, not after final judgments on the merits.

You probably heard the news by now: New Jersey has asked the US Supreme Court for review of the case involving Kalshi and prediction markets. Read more at The Closing Line (or almost every other media outlet on the planet): That sounds very important. And it is! But there’s a lot of nuance between the news, what’s happened before and what happens next. Here are some questions and answers: 1. How often does the Supreme Court grant a petition? Not often! The nation’s highest federal court generally hears fewer than 100 cases a year, meaning “1% for all petitions and 3-5% for paid petitions” will ultimately be heard. Not all cases are created equal, and it’s no shock that many never see the light of day in DC. But the legality of prediction markets has a lot of the hallmarks of a Supreme Court case. Which leads us to… 2. Will The Supreme Court take this case? Maybe, maybe not! There is no guarantee that the Supreme Court will hear New Jersey’s appeal. There are reasons both for and against. For: We have a circuit split at the appellate level, which is one factor that can make the Court more likely to grant a petition. The Supreme Court is almost certainly going to have to deal with this issue sooner or later. And sooner might make more sense; you might as well rip off the Band-Aid. There are myriad court cases still playing out, and more circuit court rulings to come. From New Jersey’s petition: This petition presents an ideal vehicle for resolving the important question whether States are prevented from regulating sports gambling merely because that gambling happens on a CFTC-registered market. This issue has led to an explosion of litigation in the lower courts and spawned immediate disagreement on this major question, including a direct, acknowledged, and irreconcilable split between the Third and Ninth Circuits. The issue is one of tremendous practical and legal consequence: Kalshi seeks to federalize the multi-billion-dollar sports betting industry at the expense of every state sports gaming law. And the decision below is badly mistaken. Certiorari is urgently needed. Against: While it might feel like we have been dealing with prediction market court cases for eons, we are actually kind of early in the legal process. The cases so far have mostly been about preliminary injunctions, not a final determination on prediction markets’ legality. The court might want to wait for a later and more fleshed out case for a variety of reasons. SCOTUS doesn’t have to take the first case that lands on its desk. For instance, Kalshi would likely appeal the Ninth Circuit decision at some point, if for no reason than California is a part of the Ninth, and it could ill-afford to lose users in that state. So if you hear someone saying it’s a slam dunk that the Supreme Court case is taken up right here, right now, that’s not really right. I don’t know what the probability is, but it’s something far short of 100% on this specific petition and case. 3. What did Kalshi have to say about New Jersey’s petition? “We disagree with New Jersey's filing. Kalshi is an open, nationwide financial exchange. It cannot be regulated by 50 different regulators. Both the Third Circuit and the District of New Jersey sided with Kalshi because the CFTC’s exclusive jurisdiction preempts state law. While New Jersey points to a recent decision in the Ninth Circuit, that decision agreed with that key principle. Where it differed, it did so based on a regulation that's in the process of being rewritten. We remain confident in the lower courts’ rulings, and nothing in New Jersey’s filing today changes our view.” — Dani Lever, Kalshi spokesperson 4. Kalshi probably regrets calling itself ‘sports betting,’ right? I would imagine so! Kalshi describing itself as “legal sports betting” was literally the first sentence of the Ninth Circuit decision. And it was referenced several times in NJ’s petition to the Supreme Court. To wit: Here’s that post: Kalshi has tried, and still tries, to wave away the idea that it sometimes uses “betting” terminology to describe the product. No matter how you try to spin it, I think it matters that it has on many occasions marketed itself as sports betting. (Kalshi almost universally avoids it in marketing now.) And obviously some courts agree that it matters. Clearly, Kalshi would have been better off avoiding using sports betting language back in 2025 from a legal perspective. Will it matter to the Supreme Court? I guess we might find out. The Event Horizon briefing A quick look at what matters most in prediction markets. 📍 The Big Story The end of the road for injury markets? Sportico: “Kalshi removed betting markets tied to athlete injury durations from its app on Tuesday. The prediction market company’s federal regulator, the Commodity Futures Trading Commission (CFTC), asked it to do so, a source at the agency told Sportico. As Sportico previously reported, the prediction market company has facilitated at least hundreds of thousands of dollars in wagers connected to player health in 2026, capitalizing on the uncertain statuses of marquee stars like Luka Dončić, Anthony Edwards and Malik Nabers as it collected fees from those bets.” I’ve been writing about this since last week, here and here. Will we see these types of markets moving forward? Given the CFTC’s reported intervention here, it would seem unlikely. 🔭 What To Watch For Oil perps? Prediction market Kalshi to file for US crude oil ‘perps’, source says (Reuters): “Kalshi is preparing to file a perpetual West Texas Intermediate crude oil contract with U.S. regulators, a source familiar with the matter said, expanding the prediction market startup’s offerings beyond cryptocurrencies and metals. The filing with the U.S. Commodity Futures Trading Commission, expected as early as next week, will seek approval for 24/5 trading of the perpetual contracts, said the source, who requested anonymity because the plans are not yet public.” 🔍 It’s notable that the CFTC previously halted a similar effort by CME Group. Reuters reported that the Kalshi listing was designed to deal with concerns around these contracts. 🔥 Hot Market Aliens? This is the first market I get when I go to the “politics” section on Kalshi: 📝 New Event Contracts New self-certifications listed with the Commodity Futures Trading Commission: Rothera (Robinhood-affiliated exchange) listed some tennis markets: 💬 Quote Of The Day “Kalshi is a sportsbook that’s just not allowed to have an in-house risk team.” —Bernard Marantelli, founder of White Swan Data, in a story at iGB. 📊 Volume Tracking For Tuesday, Sept. 1 Kalshi volume: $1.53 billion Sports markets: 27.2% of volume Parlays: 51.3% of volume Crypto markets: 17.8% of volume Trend line from Ticker Tracker: Volume on other exchanges: Polymarket US: $111.7 million Novig: $30 million Rothera: $25.1 million DraftKings Exchange: $17.9 million Underdog: $5.8 million ProphetX: $5.3 million Cash still has a place in a digital world. Besides being preferred by 63% of gaming app users, cash provides increased security and compliance for operators. With PayNearMe, you can offer a seamless, guaranteed cash-at-retail solution alongside all the popular digital payment methods like Cash App, Apple Pay, Google Pay and more—all from a single integration. News roundup Everything else important that happened in or was written about prediction markets: 🚨 Important stuff AG Nessel Secures Second Order Halting Unlawful Kalshi Sports Wagers in Michigan (press release): “Michigan Attorney General Dana Nessel has secured a preliminary injunction (PDF) against KalshiEx, LLC (Kalshi), halting the prediction market company from unlawfully offering online sports wagers in Michigan. The preliminary injunction requires Kalshi to maintain geofencing to block Michigan residents and those within Michigan’s borders from having access to its illegal sports betting contracts. Violations of the order would result in a $500,000 per day fine.” “Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices,” said Attorney General Nessel. “My office will continue to defend Michiganders and enforce our gaming laws, which ensure gambling revenue is regulated and distributed back into our communities.” More from Legal Sports Report. Rise of prediction markets sees Texas Longhorns self-report 7 minor NCAA violations related to sports wagering (Horns 24/7): “The Texas Longhorns self-reported seven NCAA violations related to sports wagering between Jan. 1 and Aug. 17, according to documents obtained by Horns247. …” “The common thread running through six of the reported violations comes via the prediction market website Kalshi…” New York Times Union Demands Company Abandon Kalshi Talks (Front Office Sports): “The NewsGuild of New York—the labor union that represents more than 2,000 Times workers across three different units—sent a letter Wednesday to Times owner and publisher A.G. Sulzberger, Athletic publisher David Perpich, and senior editors at The Athletic and its parent company demanding that the prospective sponsorship agreement not go through. ///” ⚖️ Legal and regulatory news New York Attorney General Asks Federal Court to Disregard CFTC Emergency Order to Kalshi (DeFi Rate): “New York Attorney General Letitia James weighed in on the United States Commodity Futures Trading Commission’s lawsuit against New York on Monday in the form of a letter to the US District Court for the Southern District of New York. The correspondence focuses on an August emergency order issued by the CFTC to Kalshi in response to New York’s lawsuit against Kalshi.” Kalshi Accuses Washington State of ‘Selective Non-Enforcement’ Against Rivals (Covers): “Attorneys working for the popular trading exchange sent a letter dated Aug. 28 to Washington State Gambling Commission executive director Tina Griffin, accusing the Evergreen State’s Attorney General of singling Kalshi out through ‘selective non-enforcement’ of its gambling laws.” 📣 Industry news Kalshi now in Spanish: Fanatics Introduces Fanatics Sports & Casino: One App for Fans to Bet, Trade or Play (press release): Fanatics Betting and Gaming, a subsidiary of Fanatics, a global sports platform, today announced the launch of Fanatics Sports & Casino, a single app that gives sports fans one destination to bet, trade or play; one account, one FanCash balance, all integrated into the Fanatics ONE loyalty program. The new app is available today to customers, coast to coast including California, Texas, Florida, New York and Pennsylvania. Fanatics Sports & Casino brings the full Fanatics gaming and prediction markets experience together in one place. Fans get the Fanatics Sportsbook, the fastest growing sportsbook in America, in 23 states plus Washington D.C.; Fanatics Casino in New Jersey, Pennsylvania, Michigan & West Virginia; and Fanatics Markets, the company’s federally regulated event contracts platform, in 22 states & four (4) territories across the country. The app automatically tailors the experience to each customer’s location, creating a seamless journey for fans no matter where they are. … “Sports fans have been asking for a better gaming experience, and this is it,” said Matt King, CEO of Fanatics Betting and Gaming. “Fanatics Sports & Casino gives fans across America one app where the experience travels with them, from betting the game, to trading on its biggest moments, to playing casino games. And because it’s Fanatics, every one of those bets, trades or plays earns FanCash; we can uniquely connect what fans play to what fans love in one ecosystem.” Axios: “King declined to disclose trading volume for Fanatics Markets but says the prediction business has seen ‘incredible growth,’ with Fanatics spending less than $8 million marketing it since launch.” 🔍 The three sportsbooks that are leaning into prediction markets are all relying on this strategy to different degrees. If nothing else, it makes national advertising spend more effective. 📖 Everything else you should know/read What’s the salary? These employers aren’t saying, despite warnings from New York regulators (Business Insider): “Prediction marketplace Polymarket, accounting software provider Rillet, advertising firm Icon, and digital-doorman company ButterflyMX are among the employers that continued to post New York jobs without compensation ranges after receiving at least two warnings from the state labor department, Business Insider found. Recent roles posted by these companies without pay information have included a regulatory attorney, a recruiting coordinator, and a founding creative.” Not sure why we are betting on these outcomes still: Temperature check: alarm as prediction markets lean into weather and climate bets (The Guardian): “‘Given the severity of the climate crisis, it’s crucial for policymakers and the general public to have well-calibrated forecasting data about future climate impacts,’ said a Kalshi spokesperson, citing a company study on how accurate its markets’ predictions are. Asked whether this meant Kalshi saw its weather markets as part of delivering well-calibrated forecasting data, the spokesperson said this was the case.” Meet the invisible sportsbook powering the prediction market boom (iGB): “Strip away the language of contracts, order books and event trading and Bernard Marantelli has a blunt description of what is happening inside US sports prediction markets. “,” says the founder of White Swan Data, one of the specialist firms now making markets on prediction exchanges.” Opinion - Prediction market profits are corrupting America, one public figure at a time (The Hill): “Does anyone really expect Republicans to regulate the Trump family’s prediction market cash cow? Congressional Republicans have proven their willingness to prioritize Trump’s personal interests over the public good in nearly every case. Instead, it will fall to Democrats to host serious public hearings that explore the corrosive effect prediction markets are having on our government.” Prediction markets look an awful lot like online betting (American Banker, paywall): “The question of which regulator can regulate Kalshi and Polymarket appears to be heading to the Supreme Court. But the real question that needs to be answered is, what exactly are these platforms? Entertainment, or investing?” On Substack:

New Jersey asked the Supreme Court on Wednesday to weigh in on a growing legal battle between prediction markets and states over who has the authority to regulate the platforms. It marks the first time that the dispute, which has resulted in conflicting decisions at the appellate level, has been raised to the justices. “Companies like Kalshi claim to offer legal sports betting in all 50 States, but they refuse to follow the gambling laws of any State,” New Jersey Attorney General Jennifer Davenport (D) said in a statement. “These companies have no right to offer their sports bets without following state law, which is why dozens of States across the ideological spectrum have opposed them,” she continued. Kalshi sued New Jersey last year, seeking to block the Garden State from enforcing its gambling laws against the platform. Prediction markets, which allow users to place wagers on the outcome of various events, argue their products are distinct from traditional gambling and should be federally regulated by the Commodity Futures Trading Commission (CFTC). Numerous states have disagreed, arguing the platforms fall under their jurisdiction and are subject to state gambling regulations and taxes. “States have long adopted careful laws to regulate gambling, including to prevent compulsive gambling, gambling by minors, and insider trading on sports games,” Davenport added Wednesday. “We’re calling on the Supreme Court to resolve this issue and recognize that Congress did not silently make the sports-betting industry immune from state law.” Kalshi spokesperson Dani Lever said in a statement that the company disagrees with New Jersey’s filing. “Kalshi is an open, nationwide financial exchange. It cannot be regulated by 50 different regulators,” Lever said, adding, “We remain confident in the lower courts’ rulings, and nothing in New Jersey’s filing today changes our view.” The New Jersey petition comes less than a week after the Ninth Circuit Court of Appeals ruled that states can regulate prediction markets like gambling and sportsbooks. In a unanimous decision Friday, a three-judge appeals panel upheld a lower court decision allowing Nevada to oversee Kalshi. This diverged from a ruling by the Third Circuit Court of Appeals earlier this year in New Jersey’s case, which blocked the state from enforcing its gambling laws against the company. However, Kalshi argues the two rulings are largely similar, with the Ninth Circuit differing “based on a regulation that’s in the process of being rewritten.” Prediction markets have found a key ally in the Trump administration in this dispute. CFTC Chair Michael Selig, who vowed in February to challenge any state efforts at regulating prediction markets, has so far brought lawsuits against nine states. President Trump himself waded into the dispute in late May, arguing the agency should have exclusive jurisdiction over the platforms. Updated at 2:15 p.m. EDT

Kalshi won’t let users bet whether the Supreme Court will hear a case that could upend the prediction market’s regulatory future, a spokesperson for the companyclaims. The revelation comes nearly a day after New Jersey officials asked the Supreme Court to intervene in a fight between the prediction market and state gambling regulators. States such as New Jersey believe Kalshi should follow their laws governing sports betting, but prediction markets, backed by the Trump administration, believe it should follow federal law. Although Kalshi users can bet on everything from the outcome of presidential elections to the number of goals scored in a sports game to the exact words an official will say during a press conference – the prediction market is drawing a line on the case. A spokesperson told Barron’s that the platform will not offer a prediction market on whether the Supreme Court will hear the case or the outcome of that decision in that case because Kalshi is one of the parties involved. Actions by Kalshi’s legal team could affect the outcome of the market, and Kalshi does not want to list a market that the firm itself could influence, the spokesperson told Barron’s. While the case is between New Jersey officials and Kalshi, it could have consequences for other prediction markets, such as Polymarket – which is facing similar lawsuits. Polymarket has not said whether or not it will list event contracts related to the case. The Independent has asked Kalshi and Polymarket for comment. Prediction markets have become an increasingly popular way for people – especially young people – to wager on a host of sports, politics and other events. The platforms allow users to buy and sell event contracts based on whether a future outcome could occur. Unlike traditional gambling, the platforms match buyers and sellers rather than taking the opposite side of a bet. Polymarket and Kalshi cemented themselves as platforms here to stay during the 2024 presidential election cycle, when they were used to gauge the outcome of the election. The platforms have received backing from President Donald Trump and are currently being regulated by the Commodity Futures Trading Commission. But for months, states – led by both Republicans and Democrats – have brought legal challenges against prediction markets such as Kalshi and Polymarket alleging that the companies are subject to state sports betting laws. New Jersey officials escalated the legal battle Wednesday, asking the Supreme Court to weigh in on lower courts’ split decision. In April, the Third Circuit Court of Appeals ruled in favor of Kalshi. But last week, the Ninth Circuit Court of Appeals issued an opposite opinion in a case involving Nevada. “That split has tremendous importance, as it will determine whether a multi-billion-dollar gaming industry can suddenly operate free from state sportsgaming laws,” New Jersey officials wrote in their writ of certiorari Wednesday. They added: “States have always maintained the primary police powers for health and safety matters, including for gambling.” Kalshi Spokesperson Dani Lever told NPR that the company disagreed with New Jersey’s filing and is confident in the lower-court rulings that supported the prediction market. "Kalshi is an open, nationwide financial exchange. It cannot be regulated by 50 different regulators,” Lever said. "We remain confident in the lower courts' rulings, and nothing in New Jersey's filing today changes our view."

New Jersey officials asked the U.S. Supreme Court Wednesday to step into a nationwide fight over whether prediction markets such as Kalshi must follow state sports-gambling laws. The dispute has pitted states against an industry that says it should answer only to the federal government, and has the backing of the Trump administration. Davenport’s petition asks the Supreme Court to decide who can regulate sports contracts offered by Kalshi and other prediction markets. New Jersey officials say the contracts are sports wagers subject to state gambling laws, while Kalshi says they are financial contracts overseen exclusively by the Commodity Futures Trading Commission. “Kalshi does not abide in any way with our State’s gaming laws,” said Mary Jo Flaherty, interim director of the New Jersey Division of Gaming Enforcement. “This is a states’ rights issue. In New Jersey, gaming is prohibited by its Constitution, other than for exceptions approved by New Jersey voters.” Kalshi spokesperson Dani Lever criticized the petition. “We disagree with New Jersey’s filing,” Lever said. “Kalshi is an open, nationwide financial exchange. It cannot be regulated by 50 different regulators.” In January 2025, Kalshi began offering “sports event contracts” that allow users to buy and sell contracts tied to the outcomes of sporting events. Kalshi marketed itself as “the first app for legal sports betting in all 50 states,” and sports-related contracts quickly became the platform’s main business. Over 90% of Kalshi’s trades in 2025, representing 95% of its revenue, were sports-related, according to the 9th U.S. Circuit Court of Appeals. In March 2025, the New Jersey Division of Gaming Enforcement sent the company a cease-and-desist letter for facilitating unauthorized sports betting. Kalshi sued New Jersey, arguing that its sports event contracts are not gambling but swaps regulated solely by the federal government. Swaps are financial instruments whose value is tied to another asset, event, or outcome. In 2020, theCommodity Futures Trading Commission authorized Kalshito operate as a “designated contract market,” a federally regulated exchange for derivatives. Kalshi argues that the Commodity Exchange Act gives the commission exclusive authority over contracts traded on such exchanges. In April 2025, a federal judge temporarily blocked New Jersey from enforcing its gambling laws against Kalshi while the case proceeds. The 3rd U.S. Circuit Court of Appeals upheld that order in a 2-1 decision in April 2026, finding that Kalshi was likely to prove that federal law overrides the state’s gambling rules. But on Aug. 28,the 9th U.S. Circuit Court of Appealsruled in a similar Nevada case that the state could enforce its gambling laws against Kalshi’s sports contracts. The 9th Circuit agreed with the broader principle that the Commodity Futures Trading Commission has exclusive jurisdiction over swaps traded on designated contract markets. But it concluded that Kalshi’s sports contracts did not qualify as swaps under the relevant law and regulations. In reaching that conclusion, the court disagreed with the 3rd Circuit’s interpretation of the statutory language at issue. The New Jersey attorney general says the conflicting rulings create a circuit split that the Supreme Court should resolve. Kalshi disputes that characterization. “While New Jersey points to a recent decision in the Ninth Circuit, that decision agreed with that key principle,” Lever said. “Where it differed, it did so based on a regulation that’s in the process of being rewritten. We remain confident in the lower courts’ rulings, and nothing in New Jersey’s filing today changes our view.” At least 20 states are involved in legal battles with the company over its sports contracts. Forty-four states signeda letter to the Commodity Futures Trading Commissionarguing that states retain the authority to regulate sports betting on prediction markets. “These companies have no right to offer their sports bets without following state law, which is why dozens of States across the ideological spectrum have opposed them,” Davenport said in a statement. “States have long adopted careful laws to regulate gambling, including to prevent compulsive gambling, gambling by minors, and insider trading on sports games.” The Trump administration has sided with Kalshi. The Commodity Futures Trading Commission, led by Trump appointee Michael Selig, hasfiled lawsuits against several statesand friend-of-the-court briefs in other cases arguing that the agency has exclusive authority over federally regulated prediction markets. Donald Trump Jr., the president’s son, is a paid strategic adviser to Kalshi. Prediction markets also have faced scrutiny over insider trading. Last week, the commissionordered a former White House teleprompter operator to pay $172,539for using advance access to Trump’s speeches to trade contracts on Kalshi. The agency credited Kalshi with assisting in the investigation. Ananalysis of state data by RG.comshows how quickly sports betting has grown since New Jersey legalized it in 2018. The total value of bets placed rose from about $4.58 billion in 2019 to $12.77 billion in 2024. AFederal Reserve Bank of New York staff reportfound that legalizing mobile sports betting increased sportsbook spending and was associated with lower credit scores and higher delinquency rates. Increases in auto loan and credit card delinquencies were concentrated among people younger than 40. Business Insideralso reported that bankruptcy attorneys were seeing more clients in their 20s and 30s with tens of thousands of dollars in debt tied to online gambling. Filing a petition does not mean the Supreme Court will hear the case. The court only grants about 1% of the petitions it receives each year. Curtis Brodner is a Report for America corps member covering housing and affordability for The Jersey Vindicator. He investigates the policies, people, and institutions shaping where New Jersey residents can afford to live, with a focus on accountability and solutions. Previously, he was a criminal justice reporting fellow with Columbia Journalism Investigations, producing investigative work for New York Focus. He earned a master’s degree from Columbia Journalism School as a Toni Stabile Center fellow and a bachelor’s degree in journalism from SUNY Purchase. You can reach him at Curtis AT jerseyvindicator.org.

New Jersey Officials File a Petition to the U.S. Supreme Court Over Prediction Markets The New Jersey Attorney General and the state’s Acting Director of the Division of Gaming Enforcement have formally filed a petition asking the U.S. Supreme Court to review a case aimed at resolving whether state authorities or federal agencies have jurisdiction over prediction market companies. On Wednesday, Attorney General Jennifer Davenport and Acting Director of Gaming Control Mary Jo Flaherty filed a petition for a writ of certiorari with the U.S. Supreme Court regarding New Jersey’s controls against the Kalshi prediction-market platform over its contracts on sporting events. The officials cited civil cases brought by gaming authorities in “at least 20 states” and asked the highest court in the United States to determine whether prediction-market companies could comply with the Commodity Futures Trading Commission (CFTC) while violating state laws. “Companies like Kalshi claim to offer legal sports bets in all 50 states, but refuse to comply with the gaming laws of any state,” Davenport said. “These companies have no right to offer their sports bets without following state law, so dozens of states across the ideological spectrum have opposed them […] We ask the Supreme Court to resolve this matter and recognize that Congress did not implicitly exempt the sports-betting industry from state law.” Source: New Jersey Attorney General In citing New Jersey’s controls against Kalshi, the petition raised to the Supreme Court the question of “whether the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 prevents states from regulating sports bets conducted within their jurisdictions if those bets are offered on markets registered with the [CFTC].” Cointelegraph reached out to the CFTC for comment but did not receive an immediate response. Related: Kalshi issues first lifetime ban on a Republican politician for insider betting The petition challenges an April 2024 U.S. Court of Appeals for the Third Circuit ruling, where judges ruled 2-1 against the New Jersey gaming authorities, stating that, under Kalshi’s argument, the company had a “reasonable likelihood of success” in contending that the CFTC’s Futures Trading of Commodities Exchange Act preempts state law. The petition specifically challenged the CFTC’s assertion that sports bets on prediction-market platforms constitute “swaps” under the agency’s oversight and stated: “federal law does not preempt state sports-betting laws in any case.” What are the possible consequences for Kalshi and other prediction markets? “Because federal law prohibits trading swaps outside CFTC-registered markets, a Kalshi victory would mean that all sports bets made outside those CFTC-registered markets would apparently become illegal, even if state law allows them,” the New Jersey attorney general’s office said in its filing about the petition. Kalshi spokesperson Dani Lever told Cointelegraph that the company did not agree with New Jersey’s decision to appeal to the Supreme Court and said it could not be “regulated by 50 different regulators.” “We remain confident in the decisions of the lower courts, and nothing filed today by New Jersey changes our position,” Lever said. Chart showing when the U.S. Supreme Court will hear a case involving prediction-market platforms. Source: Polymarket It is not clear whether Supreme Court justices will address the issue of prediction markets. Many experts have speculated that the justices could weigh in on a case that reached the Nevada Court of Appeals. Whether the court selects Kalshi’s case in Nevada, the New Jersey one, or a later move against another company, any potential decision could determine which authorities can regulate prediction markets. Magazine: Who is legally responsible when an AI agent runs amok?

TRENTON, N.J.— New Jersey Attorney General Jennifer Davenport has asked the U.S. Supreme Court to decide whether prediction markets can offer sports wagers without complying with state gambling laws, an issue that has divided federal courts and prompted litigation across the country.Davenport filed apetitionasking the nation’s highest court to review a federal appeals court ruling involving Kalshi, a prediction market that New Jersey argues is offering sports betting without following the state’s gambling regulations.“Companies like Kalshi claim to offer legal sports betting in all 50 States, but they refuse to follow the gambling laws of any State,” said Attorney General Davenport. “These companies have no right to offer their sports bets without following state law, which is why dozens of States across the ideological spectrum have opposed them. States have long adopted careful laws to regulate gambling, including to prevent compulsive gambling, gambling by minors, and insider trading on sports games. We’re calling on the Supreme Court to resolve this issue and recognize that Congress did not silently make the sports-betting industry immune from state law.”The dispute centers on whether sports-related contracts offered by prediction markets such as Kalshi fall exclusively under the jurisdiction of the federal Commodity Futures Trading Commission or remain subject to state gambling laws.Kalshi sued New Jersey in 2025, arguing its sports wagers are “swaps” regulated exclusively by the CFTC and therefore are not subject to New Jersey’s gambling laws.In April, the 3rd U.S. Circuit Court of Appeals ruled 2-1 in Kalshi’s favor, holding that New Jersey’s gambling laws are preempted, according to the Attorney General’s Office.“Kalshi markets itself as the ‘first app for legal sports betting in all 50 States,’ including for wagering on NCAA games held in New Jersey and participated in by New Jersey teams, which is impermissible under New Jersey’s Constitution. But Kalshi does not abide in any way with our State’s gaming laws,” said Division of Gaming Enforcement Interim Director Mary Jo Flaherty. “This is a states’ rights issue. In New Jersey, gaming is prohibited by its Constitution, other than for exceptions approved by New Jersey voters. In this case, the State is upholding the will of New Jerseyans regarding the manner in which gaming can be conducted.”New Jersey argues the appeals court’s ruling conflicts with decisions elsewhere in the country. Litigation over prediction markets and state gambling laws has emerged in at least 20 states, with dozens of lawsuits pending, according to the Attorney General’s Office.On Aug. 28, the 9th U.S. Circuit Court of Appeals reached a different conclusion, ruling that sports bets on the outcomes of sporting events do not fall within the CFTC’s exclusive jurisdiction.The 9th Circuit concluded that “Congress did not take a wrecking ball to all sports gambling regulations built up over decades by federal, state, and tribal governments” through the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.New Jersey co-led a brief in that case with 39 other jurisdictions. The 9th Circuit cited the brief in concluding “it is implausible that Congress intended to allow the CFTC to engage in the national regulation of gambling based on expansive definitions of the words ‘event’ and ‘associated with’ in a Wall Street reform bill.”According to Davenport’s office, 44 states, hundreds of tribes and casinos have opposed legal arguments advanced by Kalshi and other prediction markets.The state argues that allowing prediction markets to bypass state gambling laws could undermine protections intended to prevent underage and problem gambling, insider trading and other risks. The Attorney General’s Office also argues that state regulation helps ensure gambling operators have sufficient financial resources to pay winnings.The petition further argues that a ruling for Kalshi could have broader consequences for the sports betting industry because federal law generally prohibits swaps from being traded outside CFTC-registered markets. New Jersey contends that could potentially jeopardize sports wagering conducted through traditional sportsbooks at casinos and on tribal lands.The dispute comes eight years after the Supreme Court ruled for New Jersey inMurphy v. NCAA, striking down a federal law that effectively prevented states from authorizing sports betting. In that decision, the court said that if Congress chose not to “regulate sports gambling directly,” then “each state is free to act on its own.”Davenport’s office said this is the first petition asking the U.S. Supreme Court to address the legality of prediction markets offering sports wagers self-certified with the CFTC without complying with state gambling laws. Davenport filed apetitionasking the nation’s highest court to review a federal appeals court ruling involving Kalshi, a prediction market that New Jersey argues is offering sports betting without following the state’s gambling regulations.“Companies like Kalshi claim to offer legal sports betting in all 50 States, but they refuse to follow the gambling laws of any State,” said Attorney General Davenport. “These companies have no right to offer their sports bets without following state law, which is why dozens of States across the ideological spectrum have opposed them. States have long adopted careful laws to regulate gambling, including to prevent compulsive gambling, gambling by minors, and insider trading on sports games. We’re calling on the Supreme Court to resolve this issue and recognize that Congress did not silently make the sports-betting industry immune from state law.”The dispute centers on whether sports-related contracts offered by prediction markets such as Kalshi fall exclusively under the jurisdiction of the federal Commodity Futures Trading Commission or remain subject to state gambling laws.Kalshi sued New Jersey in 2025, arguing its sports wagers are “swaps” regulated exclusively by the CFTC and therefore are not subject to New Jersey’s gambling laws.In April, the 3rd U.S. Circuit Court of Appeals ruled 2-1 in Kalshi’s favor, holding that New Jersey’s gambling laws are preempted, according to the Attorney General’s Office.“Kalshi markets itself as the ‘first app for legal sports betting in all 50 States,’ including for wagering on NCAA games held in New Jersey and participated in by New Jersey teams, which is impermissible under New Jersey’s Constitution. But Kalshi does not abide in any way with our State’s gaming laws,” said Division of Gaming Enforcement Interim Director Mary Jo Flaherty. “This is a states’ rights issue. In New Jersey, gaming is prohibited by its Constitution, other than for exceptions approved by New Jersey voters. In this case, the State is upholding the will of New Jerseyans regarding the manner in which gaming can be conducted.”New Jersey argues the appeals court’s ruling conflicts with decisions elsewhere in the country. Litigation over prediction markets and state gambling laws has emerged in at least 20 states, with dozens of lawsuits pending, according to the Attorney General’s Office.On Aug. 28, the 9th U.S. Circuit Court of Appeals reached a different conclusion, ruling that sports bets on the outcomes of sporting events do not fall within the CFTC’s exclusive jurisdiction.The 9th Circuit concluded that “Congress did not take a wrecking ball to all sports gambling regulations built up over decades by federal, state, and tribal governments” through the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.New Jersey co-led a brief in that case with 39 other jurisdictions. The 9th Circuit cited the brief in concluding “it is implausible that Congress intended to allow the CFTC to engage in the national regulation of gambling based on expansive definitions of the words ‘event’ and ‘associated with’ in a Wall Street reform bill.”According to Davenport’s office, 44 states, hundreds of tribes and casinos have opposed legal arguments advanced by Kalshi and other prediction markets.The state argues that allowing prediction markets to bypass state gambling laws could undermine protections intended to prevent underage and problem gambling, insider trading and other risks. The Attorney General’s Office also argues that state regulation helps ensure gambling operators have sufficient financial resources to pay winnings.The petition further argues that a ruling for Kalshi could have broader consequences for the sports betting industry because federal law generally prohibits swaps from being traded outside CFTC-registered markets. New Jersey contends that could potentially jeopardize sports wagering conducted through traditional sportsbooks at casinos and on tribal lands.The dispute comes eight years after the Supreme Court ruled for New Jersey inMurphy v. NCAA, striking down a federal law that effectively prevented states from authorizing sports betting. In that decision, the court said that if Congress chose not to “regulate sports gambling directly,” then “each state is free to act on its own.”Davenport’s office said this is the first petition asking the U.S. Supreme Court to address the legality of prediction markets offering sports wagers self-certified with the CFTC without complying with state gambling laws. “Companies like Kalshi claim to offer legal sports betting in all 50 States, but they refuse to follow the gambling laws of any State,” said Attorney General Davenport. “These companies have no right to offer their sports bets without following state law, which is why dozens of States across the ideological spectrum have opposed them. States have long adopted careful laws to regulate gambling, including to prevent compulsive gambling, gambling by minors, and insider trading on sports games. We’re calling on the Supreme Court to resolve this issue and recognize that Congress did not silently make the sports-betting industry immune from state law.”The dispute centers on whether sports-related contracts offered by prediction markets such as Kalshi fall exclusively under the jurisdiction of the federal Commodity Futures Trading Commission or remain subject to state gambling laws.Kalshi sued New Jersey in 2025, arguing its sports wagers are “swaps” regulated exclusively by the CFTC and therefore are not subject to New Jersey’s gambling laws.In April, the 3rd U.S. Circuit Court of Appeals ruled 2-1 in Kalshi’s favor, holding that New Jersey’s gambling laws are preempted, according to the Attorney General’s Office.“Kalshi markets itself as the ‘first app for legal sports betting in all 50 States,’ including for wagering on NCAA games held in New Jersey and participated in by New Jersey teams, which is impermissible under New Jersey’s Constitution. But Kalshi does not abide in any way with our State’s gaming laws,” said Division of Gaming Enforcement Interim Director Mary Jo Flaherty. “This is a states’ rights issue. In New Jersey, gaming is prohibited by its Constitution, other than for exceptions approved by New Jersey voters. In this case, the State is upholding the will of New Jerseyans regarding the manner in which gaming can be conducted.”New Jersey argues the appeals court’s ruling conflicts with decisions elsewhere in the country. Litigation over prediction markets and state gambling laws has emerged in at least 20 states, with dozens of lawsuits pending, according to the Attorney General’s Office.On Aug. 28, the 9th U.S. Circuit Court of Appeals reached a different conclusion, ruling that sports bets on the outcomes of sporting events do not fall within the CFTC’s exclusive jurisdiction.The 9th Circuit concluded that “Congress did not take a wrecking ball to all sports gambling regulations built up over decades by federal, state, and tribal governments” through the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.New Jersey co-led a brief in that case with 39 other jurisdictions. The 9th Circuit cited the brief in concluding “it is implausible that Congress intended to allow the CFTC to engage in the national regulation of gambling based on expansive definitions of the words ‘event’ and ‘associated with’ in a Wall Street reform bill.”According to Davenport’s office, 44 states, hundreds of tribes and casinos have opposed legal arguments advanced by Kalshi and other prediction markets.The state argues that allowing prediction markets to bypass state gambling laws could undermine protections intended to prevent underage and problem gambling, insider trading and other risks. The Attorney General’s Office also argues that state regulation helps ensure gambling operators have sufficient financial resources to pay winnings.The petition further argues that a ruling for Kalshi could have broader consequences for the sports betting industry because federal law generally prohibits swaps from being traded outside CFTC-registered markets. New Jersey contends that could potentially jeopardize sports wagering conducted through traditional sportsbooks at casinos and on tribal lands.The dispute comes eight years after the Supreme Court ruled for New Jersey inMurphy v. NCAA, striking down a federal law that effectively prevented states from authorizing sports betting. In that decision, the court said that if Congress chose not to “regulate sports gambling directly,” then “each state is free to act on its own.”Davenport’s office said this is the first petition asking the U.S. Supreme Court to address the legality of prediction markets offering sports wagers self-certified with the CFTC without complying with state gambling laws. The dispute centers on whether sports-related contracts offered by prediction markets such as Kalshi fall exclusively under the jurisdiction of the federal Commodity Futures Trading Commission or remain subject to state gambling laws.Kalshi sued New Jersey in 2025, arguing its sports wagers are “swaps” regulated exclusively by the CFTC and therefore are not subject to New Jersey’s gambling laws.In April, the 3rd U.S. Circuit Court of Appeals ruled 2-1 in Kalshi’s favor, holding that New Jersey’s gambling laws are preempted, according to the Attorney General’s Office.“Kalshi markets itself as the ‘first app for legal sports betting in all 50 States,’ including for wagering on NCAA games held in New Jersey and participated in by New Jersey teams, which is impermissible under New Jersey’s Constitution. But Kalshi does not abide in any way with our State’s gaming laws,” said Division of Gaming Enforcement Interim Director Mary Jo Flaherty. “This is a states’ rights issue. In New Jersey, gaming is prohibited by its Constitution, other than for exceptions approved by New Jersey voters. In this case, the State is upholding the will of New Jerseyans regarding the manner in which gaming can be conducted.”New Jersey argues the appeals court’s ruling conflicts with decisions elsewhere in the country. Litigation over prediction markets and state gambling laws has emerged in at least 20 states, with dozens of lawsuits pending, according to the Attorney General’s Office.On Aug. 28, the 9th U.S. Circuit Court of Appeals reached a different conclusion, ruling that sports bets on the outcomes of sporting events do not fall within the CFTC’s exclusive jurisdiction.The 9th Circuit concluded that “Congress did not take a wrecking ball to all sports gambling regulations built up over decades by federal, state, and tribal governments” through the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.New Jersey co-led a brief in that case with 39 other jurisdictions. The 9th Circuit cited the brief in concluding “it is implausible that Congress intended to allow the CFTC to engage in the national regulation of gambling based on expansive definitions of the words ‘event’ and ‘associated with’ in a Wall Street reform bill.”According to Davenport’s office, 44 states, hundreds of tribes and casinos have opposed legal arguments advanced by Kalshi and other prediction markets.The state argues that allowing prediction markets to bypass state gambling laws could undermine protections intended to prevent underage and problem gambling, insider trading and other risks. The Attorney General’s Office also argues that state regulation helps ensure gambling operators have sufficient financial resources to pay winnings.The petition further argues that a ruling for

Michigan Attorney General Dana Nessel has secured a preliminary injunction against Kalshi, barring the prediction market company from offering sports contracts in Michigan. The order requires Kalshi to maintain geofencing that prevents Michigan residents and anyone within the state from accessing its sports contracts. Violating the order could result in a $500,000 daily fine. “Kalshi long attempted to pass itself off as a legitimate gaming operation in our state, and I am relieved that this order further protects Michigan residents from its predatory, unlicensed practices,” said Nessel. “My office will continue to defend Michiganders and enforce our gaming laws, which ensure gambling revenue is regulated and distributed back into our communities.” Nessel filed a lawsuit against Kalshi in March, alleging that the company violated Michigan’s Lawful Sports Betting Act (LSBA) by offering sports betting through event contracts without approval from the Michigan Gaming Control Board (MGCB). According to the lawsuit, Kalshi operates an online platform that allows Michigan residents to wager on sports-related outcomes under the guise of trading event contracts. The Attorney General’s office alleges that the activity constitutes unlicensed gambling under Michigan law. Kalshi subsequently sought to move the case from state court to the US District Court for the Western District of Michigan. Nessel filed a motion to remand the case, which was granted, returning the lawsuit to the Ingham County Circuit Court. An Ingham County judge sided with Michigan in June, issuing a temporary restraining order that prevented Kalshi from offering sports-related contracts in the state as the legal dispute continued. The restriction lasted until mid-July. MGCB subsequently ended its membership in the National Council on Problem Gambling in July. The move followed the nonprofit’s acceptance of a $2 million partnership with Kalshi earlier in the year. In a letter to the council, MGCB Executive Director Henry Williams said the deal was inconsistent with Michigan’s efforts to curb what state officials describe as ‘unlicensed’ and ‘illegal’ sports betting. Williams further questioned Kalshi’s positioning of its contracts as “investments” instead of gambling products, saying it could conflict with responsible gambling initiatives and create uncertainty for consumers over the safeguards that apply. Kalshi has said it will contest the state’s case. The company said in July that it disagreed with Michigan’s position and would defend itself in court, maintaining that it is subject to exclusive federal jurisdiction.