By SectorWire desk ·
The CFTC invoked emergency powers on 11 August to direct Kalshi to keep trading in New York despite a court order. A tribal gaming attorney criticised the agency's instruction.
The CFTC’s instruction leaves Kalshi facing conflicting agency and court directions over continued trading in New York.
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The dispute concerns whether states can apply gambling rules to sports-event contracts offered by federally regulated exchanges.
The dispute could affect whether prediction market operators face state gambling laws alongside federal oversight.
The outcome could determine whether prediction market operators can continue serving the US market under federal or state rules.
Kalshi’s proposed rule would allow financial penalties, suspension or account deactivation for users harassing athletes or third parties over trading.
Nevada has no fallback plan if the Supreme Court sides with prediction market operators, leaving its stance uncertain.
The suit contests state authority over Underdog’s prediction market and follows a ruling against Kalshi.