A three-judge panel of the 9th U.S. Circuit Court of Appeals in San Francisco ruled that Kalshi cannot block Nevada from overseeing its prediction markets platform, where users place bets on sports events. The unanimous decision, issued on Tuesday, concluded that federal commodity trading law likely does not preempt Nevada’s gaming regulations from applying to Kalshi’s contracts.
The ruling creates a legal split with a prior decision from the 3rd U.S. Circuit Court of Appeals in Philadelphia, which found in April that New Jersey lacked authority to regulate Kalshi’s platform. The conflicting rulings increase the likelihood that the U.S. Supreme Court may intervene to resolve whether state gaming authorities or the U.S. Commodity Futures Trading Commission hold jurisdiction over prediction markets.
Kalshi operates a platform where users trade contracts tied to outcomes such as sporting events, which the company has argued fall under commodity futures regulation rather than state gaming laws. Nevada, home to major U.S. gaming regulators, has asserted its authority to oversee such platforms, leading to the legal dispute.
