Federal appeals court says New Jersey cannot block Kalshi’s sports event contracts
The Facts
- A three-judge panel of the U.S. Court of Appeals for the Third Circuit ruled 2-1 in Kalshi’s favor.
- The court ruled that New Jersey regulators cannot prevent Kalshi from offering sports-related event contracts to users in the state.
- The panel found that the Commodity Exchange Act gives the CFTC authority over Kalshi’s sports-related event contracts and preempts New Jersey state law in this dispute.
- The appeals court decision upheld a preliminary injunction that had blocked New Jersey from enforcing its action against Kalshi.
- Kalshi is registered with the CFTC as a designated contract market.
- The case is part of a broader conflict between state gaming regulators and prediction market operators over who has authority to regulate these products.
- Several reports described the ruling as the first federal appeals court decision on the question of state regulation of prediction markets.
Context
What did the court decide?
The Third Circuit said New Jersey cannot enforce its gambling restrictions against Kalshi’s sports-related event contracts because those contracts fall under federal oversight by the CFTC, at least at this stage of the case Guardian,Reuters,CNA.
Why does the ruling matter beyond New Jersey?
The dispute goes to the center of a wider fight over whether prediction markets are regulated financial products or state-regulated gambling. Multiple states have challenged these platforms, and this was described as the first federal appeals ruling on that issue Guardian,CNBC,Bloomberg Business.
Does this end the legal fight over Kalshi’s sports markets?
No. The ruling affirms a preliminary injunction, which means Kalshi can keep operating in New Jersey while the underlying lawsuit continues rather than finally resolving every issue in the case Ars Technica,PYMNTS.com,Sports Betting Dime.
The receipts — all 52 sources
Wire services (6)
ReutersSuperhits 97.9 Terre Haute, INNew Jersey cannot regulate Kalshi's prediction market, US ap...
Independent coverage (46)
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CNBCNew Jersey cannot regulate Kalshi's prediction market, U.S. ...
FinanceFeedsUS Court of Appeals for the Third Circuit Rules for Kalshi i...
Washington ExaminerNevada judge upholds ban on prediction market platform Kalsh...
Ars TechnicaSports bets on prediction markets ruled to be "swaps," exemp...
engadgetNew Jersey has no right to ban Kalshi's prediction market, U...
New York PostKalshi clinches legal win in New Jersey case as states fight...
sportsbusinessjournal.comU.S. appeals court blocks N.J. from regulating Kalshi
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PYMNTS.comAppeals Court Rules CFTC Has Exclusive Jurisdiction Over Eve...
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Sports Betting DimeKalshi Gains Victory In New Jersey as Preliminary Injunction...
The VergeUS appeals court rules New Jersey can't regulate Kalshi.
The Crypto TimesU.S. Court Affirms CFTC Authority Over Kalshi Contracts
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CoinDeskAppeals court blocks New Jersey from shutting down Kalshi's ...
AMBCryptoU.S. court backs Kalshi, reinforcing CFTC's push for federal...
The BlockKalshi wins appeal against New Jersey over sports event cont...
Front Office SportsCourt Keeps Kalshi's Sports Contracts Live in New Jersey
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DevdiscourseCourt Clears Path for Kalshi in Sports Betting Showdown | La...
CNANew Jersey cannot regulate Kalshi's prediction market, US ap...
Court House News ServiceThird Circuit blocks states from regulating Kalshi predictio...
Covers.comKalshi Notches New Jersey Win Amid Sports Prediction Legal W...
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