Appeals court rules that states can regulate Kalshi’s sports prediction markets, dealing another legal blow to platforms

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1. 1h ago

   Appeals Court Rules States Can Regulate Kalshi Sports Markets

   A federal appeals court ruled that states retain the authority to regulate Kalshi's sports-related event contracts under state gambling laws. The unanimous decision from the Sixth U.S. Circuit Court of Appeals dealt a significant legal blow to the prediction market platform, siding with officials in Ohio and Tennessee. Judges found that Kalshi failed to prove its sports event contracts qualify as swaps under federal oversight, opening the door for broader state-level regulatory crackdowns.

   Why it matters

   The ruling marks the second time in less than a month that an appeals court has decided states have a valid role in overseeing sports prediction markets. This decision deepens a division among U.S. circuit courts regarding federal preemption of prediction markets, which observers suggest increases the likelihood that the dispute will ultimately reach the U.S. Supreme Court.

   What is confirmed

   • The 6th U.S. Circuit Court of Appeals ruled against Kalshi on Friday, determining states can regulate prediction market platforms like gambling.
   • A three-judge panel unanimously sided with Ohio and Tennessee, finding Kalshi did not show its sports-event contracts are swaps.
   • The decision is the second in less than a month by an appeals court ruling that states have a role in regulating sports-related event contracts.

   Still unconfirmed

   • Kalshi's defiance of state gambling laws may be headed to the Supreme Court.

   What to watch next

   • Whether Kalshi files an appeal or petition for review with the U.S. Supreme Court
   • Further regulatory actions or enforcement measures by Ohio, Tennessee, and other states against prediction market platforms
   Sources used for this update (16)

   1. www.cbssports.com — Is Kalshi Legal in California? September 2026 Status
   2. wsj.com — Kalshi’s Embrace of Sports Betting Tests Rules for Prediction Markets
   3. CNBC — Appeals court rules that states can regulate Kalshi’s sports prediction markets, dealing another legal blow to platforms
   4. New York Post — Inside Kalshi CEO Tarek Mansour's testy relationship with Indian casinos -- and how it could pose an existential threat: 'Lying little twerp'
   5. Al Jazeera — US court rules against Kalshi, says states can regulate prediction markets
   6. nypost.com — Kalshi subject to state gambling laws, appeals court finds — major blow to prediction market giant
   7. Mashable — Appeals court says Ohio and Tennessee can regulate Kalshi under gambling laws
   8. 1470 & 100.3 WMBD — US appeals court rules against Kalshi, says states can regulate prediction markets
   9. Sportico.com — Kalshi Split Widens With 6th Circuit Ruling on Sports Event Contracts
   10. Cleveland.com — Sixth Circuit rules Ohio can regulate Kalshi sports contracts
   11. www.cnbc.com — Appeals court rules states can regulate sports prediction markets
   12. arstechnica.com — Kalshi loses again as judges rule prediction markets must obey gambling laws
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