Business & Finance
Federal appeals court permits states to regulate Kalshi sports prediction contracts
A unanimous 6th Circuit panel ruled federal law does not stop states from applying gambling rules to prediction markets.
The short version
- A three-judge 6th Circuit panel unanimously ruled that Ohio and Tennessee can enforce state gambling laws against Kalshi's sports event contracts.[CNBC · Al Jazeera]
- The decision overturns a lower court ruling in Tennessee while upholding an Ohio district court decision in favor of state regulators.[CNBC]
- The ruling deepens a split among federal appeals courts over whether CFTC swap authority preempts state regulation, increasing potential U.S. Supreme Court intervention.[CNBC]
Key facts
- A three-judge panel for the 6th U.S. Circuit Court of Appeals ruled unanimously that state gambling laws apply to Kalshi's sports event contracts.[CNBC · Al Jazeera]
- The court held that Kalshi failed to prove its sports-event contracts meet the statutory definition of a swap under CFTC exclusive jurisdiction.[CNBC]
- The decision overturns a Tennessee federal district court ruling and upholds a federal district court decision in Ohio.[CNBC]
- The ruling aligns with a previous 9th Circuit decision favoring Nevada, while contrasting with a 3rd Circuit ruling favoring CFTC preemption in New Jersey.[CNBC · Al Jazeera]
What remains uncertain
- It remains uncertain whether the U.S. Supreme Court will take up the issue to resolve the circuit court split on prediction market jurisdiction.[CNBC · Al Jazeera]
Sources
Outlet counts describe coverage, not independent confirmation. Reports may share a wire service or original source.