An opinion piece on a US betting industry site examines the CFTC’s changing position on prediction markets amid court cases across the country. IMGL president Marc Dunbar said the commission’s stance carries little weight in court; judges have reached mixed views, and the issue remains unresolved.
Operators and advisers face uncertainty while courts consider whether event contracts fall under the CFTC’s authority.
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Kalshi chief executive Tarek Mansour defended prediction-market transparency at DC Fintech Week, saying visible transactions help identify suspicious activity. The report cited enforcement actions involving George Santos and Gabriel Perez, as well as a criminal case involving alleged trading by Gannon Ken Van Dyke. Kalshi said it has added employer disclosures and compliance checks for contracts involving potentially sensitive information.
Litigants have started citing a Ninth Circuit decision against Kalshi in other prediction market cases. The outlet said the ruling produced the first split between federal appeals courts on prediction markets, raising the stakes for Kalshi, state regulators and a possible Supreme Court fight.
A three-judge panel of the US Court of Appeals for the Ninth Circuit heard arguments on 16 April in four cases involving Nevada and sports event contracts offered through designated contract markets. The cases include Kalshi, Robinhood Derivatives and North American Derivatives Exchange; an earlier Third Circuit ruling upheld a preliminary injunction blocking New Jersey from prohibiting Kalshi’s contracts.
Jefferies analyst David Katz said the US Supreme Court could hear prediction market disputes as soon as 2027, with the cases’ timing and selection uncertain. His report outlines four scenarios involving Kalshi and state challenges, and rates possible outcomes against the company from medium to very high probability.
More than 20 US senators, led by Adam Schiff and Catherine Cortez Masto, urged the CFTC on 13 February to avoid intervening in court cases over prediction markets. Their letter called for the agency to maintain prohibitions on event contracts involving gaming, war, terrorism and assassination, while the CFTC chairman has said staff should reassess participation in pending cases.