Federal appeals court panel gives Nevada a win in its fight to regulate prediction market Kalshi
Summary
A federal appeals court panel decided that Nevada can continue to regulate the prediction market company Kalshi and stop it from trading on sports and election events until it gets a gambling license. The court ruled that federal law does not override Nevada’s gambling laws for Kalshi’s business, and the court sent part of the case back to a lower court for further review.Key Facts
- Kalshi is a company that operates prediction markets where people trade contracts based on sports and election outcomes.
- Nevada’s Gaming Control Board told Kalshi to stop trading because it did not have a state gambling license.
- Kalshi argued it should be regulated by the federal Commodity Futures Trading Commission (CFTC), not Nevada, claiming it is a “designated contract market.”
- A panel of the 9th U.S. Circuit Court of Appeals said Nevada’s gambling laws likely apply and federal law does not prevent the state from regulating Kalshi.
- The court rejected Kalshi’s request to restart trading on sports and election contracts in Nevada while legal battles continue.
- Nevada’s attorney general called the ruling a major win for state authority over gaming.
- The case over prediction markets is happening in about 20 states, and there are conflicting court decisions raising the chance the U.S. Supreme Court will decide the issue.
- Kalshi plans to seek further court review of the ruling.
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