US states are challenging prediction markets that offer event contracts they argue amount to sports betting, according to the report. The dispute concerns whether the Commodity Futures Trading Commission or state gambling authorities have regulatory authority, and which consumer protections apply.
The court outcomes could determine whether prediction-market operators face state sportsbook consumer-protection requirements.
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Idaho joined a 39-state coalition supporting Nevada in litigation before the Ninth Circuit over the CFTC’s authority concerning sports event contracts. The states argue that the agency’s position could prevent states from enforcing their gambling laws; Idaho Attorney General Raúl Labrador said the coalition is defending state regulatory authority.
President Donald Trump said the Commodity Futures Trading Commission should have sole authority over prediction markets and that state regulators should not interfere, according to reports. The coverage also says Minnesota enacted a law intended to block prediction-market operators, while federal authorities responded with legal action asserting federal authority. Kalshi and Polymarket maintain that they operate as federally regulated exchanges, not gambling businesses.
An Italian-language analysis of US prediction markets described conflicting court positions on state efforts to restrict platforms including Kalshi. It said a Nevada injunction was later revoked, while a Tennessee injunction remained in place, and characterised the wider legal question as unresolved.
An Ingham County Circuit Court judge ordered Kalshi to temporarily stop offering sports-event contracts to Michigan residents, following a lawsuit by Attorney General Dana Nessel. The order requires the company to use effective geolocation controls and warns of possible sanctions of US$120,000 per day for non-compliance.
The Ninth Circuit on 3 November declined to rehear Kalshi’s challenge to Nevada’s treatment of its sports markets. Separately, the Second Circuit denied injunction requests by Kalshi and Coinbase, allowing authorities in New York and Connecticut to continue enforcement while appeals proceed; Kalshi has 90 days to seek Supreme Court review of the Nevada ruling.
The Ninth Circuit declined Kalshi's requests for a panel rehearing and a rehearing en banc concerning its Nevada ruling. Separately, the Second Circuit denied injunctions sought by Kalshi and Coinbase that would have stopped states enforcing gambling laws against their sports event contracts while the appeals continue.