APPEALS COURT LETS STATES REGULATE KALSHI SPORTS BETS

The court rejected Kalshi's argument that its sports contracts qualify as swaps, which would shield them from state gambling regulations and place them solely under Commodity Futures Trading Commission (CFTC) jurisdiction. Kalshi, a prediction markets platform, had sought federal protection for its offerings. The appeals court decision reverses that position, opening the door for individual states to apply their own gambling rules. The ruling affects how prediction markets operate across the US and could influence other similar platforms. States now have clearer authority to regulate or restrict these contracts within their borders. Kalshi may pursue further legal options, though the appeals court decision represents a significant setback in its regulatory strategy. The outcome could reshape the competitive landscape for prediction market operators navigating US regulation.