Kalshi Loses Nevada Court Fight as Prediction Markets Battle Over Regulation
Summary
The 9th Circuit ruled unanimously that Kalshi is unlikely to prove the Commodity Exchange Act overrides Nevada's licensing requirements, dealing a direct blow to its sports prediction contracts. Judge Ryan Nelson wrote that Kalshi's sports contracts resemble sports betting and do not qualify as swaps under Dodd-Frank, rejecting CFTC oversight claims. This creates a circuit split with the Third Circuit's April ruling that blocked New Jersey from regulating Kalshi, raising the odds the Supreme Court will settle the state-vs-CFTC question. Nevada, Massachusetts, Michigan, and Washington have already won court orders restricting Kalshi's operations. The ruling threatens a core product line while the company continues to grow volume and pursue a $40B valuation.
This news item was assessed with negative market sentiment and an importance score of 8 out of 10. Source: Benzinga.